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Wal-Mart to build distribution center in Mankato

500 full-time jobs

A planned Wal-Mart distribution center will bring 500 full-time jobs to Mankato. The city was selected because of its labor pool and local and state government cooperation.

2006-04-09
By Tim Krohn, The Free Press [published in The Free Press, Mankato, MN, 11/16/2005]

MANKATO — One of the biggest development successes ever for Mankato brought smiles all around as Wal-Mart announced it will build an 880,000-square-foot food distribution center. It will create 500 to 700 new full-time jobs and spur an array of new support businesses and jobs.

It will be the first Wal-Mart distribution center in Minnesota.

When it is open, in 2008, a semi truck will be coming or leaving the distribution center every two minutes, 24 hours a day, every day of the year. The center will support Wal-Mart grocery stores in the five-state area.

"We believe this is a watershed moment," said Mankato City Manager Pat Hentges. "A project like this has much spin-off potential."

The center will be built on a 150-acre parcel east of Midwest Wireless and north of Highway 14. Hentges said it will be among the top property taxpayers in Mankato, following NSP and River Hills Mall. The total project cost will be in the $60 million to $100 million range.

Colby Tanner, real estate manager for Wal-Mart, said the quality of the site, the cooperative effort of local and state governments and the labor pool here made the company choose Mankato over potential sites in four states.

"This particular site is better than I've seen in a while," Tanner said. "We evaluate the labor pool wherever we look. This area scored extremely high."

John Bisio, with Wal-Mart community affairs, said the center "represents good, clean industry." Bisio said the new distribution center will create 500 new jobs with competitive wages, benefits and stability.

The annual payroll is expected to be about $21 million. He said the job numbers are likely to grow to more than 700 within three years. That would make it the fifth largest employer in the city.

While they did not reveal what starting wages are likely to be, an Internet search of job openings at similar distribution centers around the country show several offering $14 to $16 per hour.

Hentges said the project is especially good because the city did not have to provide incentives to attract Wal-Mart. The city and Blue Earth County will dedicate some of the property taxes collected from the project to pay for improvements to highways and to extend sewer, water and other infrastructure.

"This is the best company I've dealt with," Hentges said. He said Wal-Mart simply said what things they needed in a site and never asked for any incentives or free land.

Wal-Mart is buying the land from James and Betty Sohler, Dorothy Sohler, and Sharon Karstens, in a deal brokered by Lidstrom Commercial Realtors.

About $5.3 million in site improvements will be done, including extending Technology Drive from the Eastwood Industrial Park and relocating a gas pipeline. Blue Earth County will widen County Road 3 to a four lane for about two-thirds of a mile, from Highway 22 to the site of the distribution center.

The state is providing more than $2 million in an infrastructure grant to cover some of the costs with the additional costs coming from property taxes paid by Wal-Mart and by any other developments that build in the immediate area.

While Wal-Mart will use 150 acres of land, the road and infrastructure improvements will open up nearly 600 additional acres in the vicinity for development.

Bisio said about half of the distribution center will contain refrigerated and frozen storage areas and about half dry-storage area. The center will be highly automated, including large elevators that lift pallets of food and stack them on shelves.

Dozens of civic and business leaders turned out at the Intergovernmental Center for the announcement Tuesday, including North Mankato officials. North Mankato also had vied for the Wal-Mart center but was eliminated as a possible site by the company.

Hentges commended North Mankato officials for continuing to champion the project for Mankato after they were out of the running. "This is a great project on either side of the river," he said.

Mike Laven, Mankato City Council member and interim mayor, said the project is a major benefit in itself and in the spin-off business it will spur. "I'm excited about those support businesses that move in to support a distribution center of this size."

Blue Earth County Administrator Dennis McCoy was short and direct on what he thought of the project: "Good, good stuff."

He said the development will help the county improve roads more quickly, particularly County Road 3.

There is also a plan to eventually rebuild County Road 12, which goes past the airport. Rather than turn sharply west, south of the airport, the road would be brought straight south, with a new interchange at Highway 14, near the site of the new distribution center.

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