Zenith City Experiencing Economic Renaissance

City of Duluth, Minnesota
Written by Leon Bracey

The City of Duluth, Minnesota has evolved from its days of heavy manufacturing, lumber, steel and concrete production to support diverse sectors such as healthcare, education, technology and aviation. Mayor Don Ness spoke with Business in Focus once again about the development and progress Duluth has made since we last featured the city in June of 2014. “Our economic development projects continue to move forward,” says the Mayor.
“The progress continues to accelerate. From large scale public investments like the Duluth International Airport and Amsoil Arena, to significant investment in new housing projects; from improved maintenance in our public parks, to maurices’ new headquarters in downtown. All of these improvements contribute to a significant change in how people see Duluth.”

The city of Duluth has continued its path of growth and economic redevelopment to attract new industries and companies. For example, Duluth-based clothing retailer maurices is building a 200,000-square-foot, 11-story headquarters in the heart of downtown Duluth. The cost of the project will be $70 million and it will accommodate up to 600 employees. The new building will consolidate operations that were previously in three separate buildings throughout the downtown, and its construction will provide approximately 250 jobs during the construction phase.

In addition to providing space for new job growth at maurices, the new building will also serve as a catalyst for development in the western end of downtown Duluth. The new building will be designed to blend in with the architecture of the area and has a targeted completion date of December 2015. maurices started in the city in 1931 as a small women’s fashion shop and has grown to over 800 stores in 44 states across the country.

Another notable construction project in downtown Duluth is the $27 million Duluth Multimodal Transportation Center for the Duluth Transit Authority. The design-build project will serve pedestrians, bicycles, bus transit, and passenger automobiles in a connective hub located in the heart of downtown. The project is scheduled for completion by 2016.

Duluth is also capitalizing on its climate and topography to attract new industries such as information technology and data centers. Companies in this sector have chosen Duluth to take advantage of the area’s cold winters; this way, these companies can save on the energy costs associated with cooling the heat-producing IT equipment data centers necessitate. Iowa based data firm Involta constructed a secured data center to take advantage of the city’s cooler weather to maintain equipment as well as the demonstrated partnership structure that worked to bring the project to fruition. Duluth is also the terminus of a $250 million fiber network project connecting Duluth with its regional neighbors through high speed communications.

Aircraft manufacturing company Cirrus is also breaking ground on a new production facility this year to help facilitate the production of new jets. “Jet production alone will add another 150 jobs in addition to the 500+ jobs already in place,” Mayor Ness shares. “This groundbreaking personal jet further solidifies Cirrus and Duluth’s position as a world leader in general aviation.”

Besides Cirrus, Duluth is also home to AAR Aircraft, Monaco Air, and Duluth International Airport. All of these companies are important to the aviation industry in Duluth and have brought in new opportunities for job seekers. Local colleges have collaborated with these firms to train the workforce with the needed technical expertise and knowledge to help the industry thrive in the city.

The city of Duluth is abuzz with economic development projects that will bring abundant job growth. Over 36 residential projects are either under construction or in the planning stages, which will bring in over 2700 additional units, some of the most growth the housing sector in Duluth has seen in many decades. Housing developers are also planning to begin construction in summer 2015 on 577 new rental housing units, bringing in more than $120 million into the local economy. “Our economy is growing so quickly, our housing stock is stressed,” says Mayor Ness. “We have an immediate need for hundreds of new units. Fortunately, developers are looking at Duluth as a good investment.”

As a result, Duluth is seeing across-the-board growth which is what Ness and city officials want to accomplish. According to the latest figures from the Minnesota Department of Employment and Economic Development, Duluth’s unemployment fell to 3.7 percent by December 2014, the lowest unemployment rate in the city in decades. With over 1,000 job vacancies among various industries, Duluth is truly living up to its nickname as the ‘Zenith City.’

“Duluth has entered a new virtuous cycle in which economic activity is creating growth opportunities for local companies,” Mayor Ness explains.

Another notable sector in the city is healthcare. The two largest healthcare systems in Northeastern Minnesota – Essentia Health and St. Luke’s Hospital – have operations in Duluth. These first-rate hospital systems together offer 55 specialty care areas and employ about 12,000 professionals with over 750,000 annual medical visits. Medical equipment manufacturer GeaCom Inc. is based in the city and is noted for developing a hand-held translation device designed for use in healthcare facilities. Known as the Phrazer, the translator won major awards for its innovation and use.

An aggressive cleanup and revitalization effort has positioned Duluth’s St. Louis River corridor for tremendous economic revitalization across multiple sectors. The corridor holds abundant opportunities for light industrial and skilled manufacturing jobs. The St. Louis River corridor possesses remarkable strengths, like its 1,000+ acres of potential industrial sites; extensive utility infrastructure and rail availability; shipping capacity and waterfront sites; and a skilled and loyal workforce that continues Duluth’s proud industrial heritage. On top of its industrial advantages, significant investment in the area’s natural environment over the last decade has transformed the river corridor into a world-class outdoor adventure destination, exponentially bolstering the corridor’s potential for long-term vibrancy and economic growth.

Lawn furniture company Loll Designs has recently moved into a larger design and production facility in the St. Louis River corridor and is growing steadily. The locally based company is known for its all-weather, outdoor furniture and accessories made with recycled plastic – mostly from milk jugs. “Aside from the better-known fact that Loll is an incredible company, the business is one example of a bigger movement characterized by a high value on a healthy work/life balance. It’s created a culture that people are really wanting to be a part of—a creative work environment with outdoor recreation and environmental learning opportunities right outside the business’ backdoor,” says Mayor Ness.

Besides businesses, the St. Louis River corridor project also allows the city of Duluth to take advantage of the natural beauty of the area. The project will feature park improvements, river access points, new trails and other amenities along the river and throughout the western part of the city. The city’s goal is to make a seamless, well-integrated family experience by using the amazing natural attributes of the river corridor. World-class trail systems and improved river access will provide days’ worth of activities for people of all ages and abilities. Duluth is reclaiming old brownfields and superfund sites for job creation plus river and trail-based recreation in the area. The redevelopment of the corridor has sparked a lot of enthusiasm for a part of town that has felt neglected for decades.

Several annual events take advantage of Duluth’s natural scenery. Grandma’s Marathon is typically held in June, a road race that takes place along the shores of Lake Superior with the finish line located in Canal Park by Grandma’s Saloon & Grill. The event attracts tens of thousands of participants each year. Another notable event is the Tall Ships Festival, which will return to the city in 2016. The event was last held in 2013 and takes advantage of Duluth’s maritime heritage and its location along the lake. Tall Ships first came to Duluth in 2013 and was the single largest event in the region’s history with 200,000 visitors and an estimated direct economic impact of $15 million. During winter, over 200,000 visitors enjoy Bentleyville, one of the largest free holiday light displays in the Midwest, that boasts 3 million+ LED lights that adorn iconic sculptures and figures. “We are fast becoming a year-round destination,” says the Mayor. “Duluth can make a strong claim for being the premier destination of the North.”

With a dedicated, highly skilled workforce, high productivity has long been a part of the City of Duluth. Thanks to low worker turnover, job growth, and strong public-private partnerships, Duluth is truly living up to being the “Zenith City of the Unsalted Seas,” and is poised for continued economic growth with its existing traditional industries alongside new opportunities.

“We really encourage folks to look at Duluth with fresh eyes,” says Mayor Ness. “Duluth today is a very different place than even a decade ago. Those who are familiar with Duluth’s past have preconceived notions of a struggling, post-industrial city. Today, you can see and feel the energy that has transformed this city. When folks come back today, they’re amazed at the progress—from being one of the most distressed cities in the nation in the 80s, the revitalization has been nothing short of remarkable. But we’re only in the very beginning stages. The best is yet to come.”



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