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Construction is on the rise, though it hasn’t hit pre-recession levels

Published 2:41pm Friday, May 16, 2014

The last two years in Albert Lea have seen higher construction compared to the prior four years, according to building permits.

But has the city risen above the Great Recession, and is it back to the levels of construction the area was seeing before?

According to permits filed with Albert Lea’s Inspection Department, the city saw construction valued at $28.2 million in 2005; in 2006, it was at $38.74 million.

Construction dropped to $24.36 million in 2007, and it has not been back to those levels since. The value of construction decreased a little each year after until it bottomed out in 2011 at $10.41 million in construction.

In 2012, the city saw double the value of construction at $20.15 million, and in 2013 it valued $16.08 million.

Though there was a decrease in 2013 compared to 2012, the construction brought visible projects to Albert Lea, including three major projects on North Bridge Avenue, a new senior living complex, renovations in buildings downtown and several industrial additions.

Ryan Nolander, executive director of the Albert Lea Economic Development Agency, and Dan Dorman, former executive director, noted a sign of economic recovery often comes in the form of additions to manufacturing companies.

Albert Lea has seen additions to Mrs. Gerry’s Kitchen, Zumbro River Brand and Pro Manufacturing, to name a few, and Nolander said he has received calls about other possible expansions.

“I think you’re seeing a little bit more activity than you were,” he said. “You’re starting to see it open up a bit.”

Albert Lea-Freeborn County Chamber of Commerce Director Randy Kehr agreed.

“From what I’m hearing and what I’m seeing, it appears as though things are turning around,” Kehr said. “There’s a lot of movement. There’s a lot of shuffling of businesses trying to pick up new ways to attract people, and I think people are feeling good.”

Construction companies also are charging more now for contracts than they were in 2008, when there were fewer projects, Kehr said.

Building permits in Freeborn County outside of Albert Lea have fluctuated since 2007, with the highest value coming in 2009 at $24.3 million. Of that amount, $19 million came from commercial wind towers.

The year 2010 was another busy year because of recovery from the June 17, 2010, tornadoes. Thirty-five new homes were built that year, 22 of which were because of the tornadoes. Construction totaled $13.62 million.

Since then, construction has gone from $7 million in 2011, to $12.49 million in 2012 to $8.18 million in 2013.

 

Home construction and sales

In Albert Lea there were six new single family homes and three twin homes built in 2013 with a value of more than $2.4 million. Outside of Albert Lea in Freeborn County, there were 14.

Dawn Freeman Swalve, an associate broker with Coldwell Banker who is part of the Southeast Minnesota Association of Realtors, said Albert Lea saw a 30 percent increase in homes sold in 2013 compared to 2012.

In 2012, there were 197 sold, and in 2013 there were 228. Furthermore, there has already been an increase in homes sold in January of this year compared to January of 2013 — despite many days of cold, stormy weather.

“I think that’s a strong indication,” she said. “We’re seeing more confidence in the economy, and we’re optimistic that 2014 will increase even more.”

Swalve said the number of houses on the market has decreased from about 163 in January of last year to about 140 in January of this year, which makes for a better seller’s market.

 

Construction highlights

Some of the commercial construction highlights from 2013 were the following, according to city building permits:

• Trail’s Travel Center, 820 Happy Trails Lane, remodeled its banquet room into a bar. The estimated value was $300,000.

• The former Lakeside Cafe, 410 Bridge Ave., was remodeled into Sterling Drug. The project was estimated at $160,000.

• Kwik Trip, 2611 Bridge Ave., constructed a new convenience store estimated at $1.08 million.

• Vern Eide Chevrolet, 2527 Bridge Ave., remodeled its store. The improvements were estimated at $700,000.

• Prairie Senior Cottages, 1602 Fountain St., constructed a 20-unit senior living complex estimated at $1.2 million.

• Mrs. Gerry’s Kitchen, 2110 Y.H. Hanson Ave., constructed a small salads and freezer wall panel estimated at $300,000.

• Albert Lea School District 241 made improvements to the heating, ventilation and air conditioning system at Sibley Elementary, 1501 W. Front St. The estimated value was $1.66 million.

• Dash-in Grocery, 201 Front St., got a permit to remodel its car wash into a liquor store. The project was estimated at $580,000.

• Hy-Vee Gas, 2717 Bridge Ave., began building its new convenience store and gas station. The project was estimated at $1.65 million.

• D&S Holding of Albert Lea, 77917 209th St., obtained a permit for an addition valued at $499,000.

Outside of Albert Lea in Freeborn County, some of the larger projects included mechanical work and tanks at the REG Albert Lea plant, 15200 780th Ave., south of Albert Lea, totaling almost $700,000.

Northern Country Co-Op in Emmons had a new bin installed valued at $138,000.