New Austin Hy-Vee distribution hub is still under consideration

Published 9:33 pm Monday, November 20, 2017

By Albert Lea Tribune

The Development Corporation of Austin said Friday that Hy-Vee continues to move forward with the required studies and reviews that would be needed before construction could begin on a new distribution center in Austin.

Work on an environmental impact study will continue even with Hy-Vee’s recent decision to delay its timeline on the distribution center’s construction due to the company’s revised plans for Twin Cities growth, said DCA President John Garry.

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DCA members and the local business community are “thrilled” about the economic impact this project could have on Austin, said DCA Board Chair Shelley King of Baudler, Maus, Forman & King, LLP.

“One of the DCA’s goals is to bring more good-paying jobs to Austin, whether that’s attracting them from outside like this or from companies already here,” King said.

The high level of capital investment and jobs associated with economic development projects like the Hy-Vee distribution center are why these opportunities are important, competitive and highly coveted, Garry said.

He added Hy-Vee has not dropped its plans for Austin, and “Hy-Vee plans to continue the state-required environmental review process and we’ve been given no reason to think this project isn’t still a possibility for Austin at some point.”

Earlier this month, Hy-Vee said it would re-evaluate its need for a distribution center and announced it would delay the Austin project, first announced in September

On Friday, Hy-Vee officials acknowledged they had read the DCA news release, and said the information was current, but had nothing more to add.

No matter whether the Hy-Vee distribution center happens in Austin, DCA will continue working to attract additional economic development projects, Garry said.

“We’ve got so much to offer as a community,” he said. “Austin is showing it is a great landing space for major projects.”

“For Mower County, the U.S. Department of Commerce figures show that $1 million in construction spent for the duration of a project creates 8.5 construction jobs,” Garry said. “We like it best when local contractors get work, but the portion going to out-of-towners also creates local economic activity through meals, hotel stays, shopping and more.”

Landing a large project is exceptionally competitive, especially with highly reputable companies that treat employees well and are good community members like Hy-Vee, Garry added. The new jobs and construction of such a project could mean tens of millions of new dollars in the community.

Beyond new jobs and construction, there is the potential for a lot of good for the rest of the community, Garry said. Businesses might want to expand or relocate to Austin to be close to a distribution center. Community job growth may increase wages for employees of other local businesses that need to retain and attract employees. The addition of new members to the area could lead to new housing development and increase demand for buying or renting of existing homes.

“The Chamber fully supports efforts to bring a Hy-Vee distribution center to Austin, and we remain hopeful that this project will come to fruition,” said Sandy Forstner, executive director of the Austin Area Chamber of Commerce. “Hy-Vee is a great company — one we know well. Their investment in Austin would benefit our entire community, providing new employment and business opportunities that will help our economy grow.”

Hy-Vee on Wednesday issued a release that outlined its commitment to expanding some of its Iowa operations to include fresh cut fruits and vegetables (Chariton), commissary and central bakery (Ankeny)  and convenience and meal solutions, in Des Moines and Davenport. Hy-Vee originated its business in Iowa and is headquartered in West Des Moines.

“This fiscal year, we have approved one of our largest capital expenditure budgets in our company’s history to make sure we are not only meeting our customers’ needs, but fulfilling their wants, now and in the future,” said Randy Edeker, Hy-Vee’s chairman, CEO and president. “We’ve studied customer habits and lifestyles and know that fewer people are cooking meals at home than ever before. We want our offerings to help individuals who are looking for something healthy to eat on the go as well as families who want to enjoy a sit-down meal that they can easily claim as their own.”

Hy-Vee also reported it was planning to open three new e-commerce fulfillment centers in Kansas City, Twin Cities and Omaha, in the upcoming years. These facilities are in addition to the existing fulfillment center in Des Moines and will meet the needs of the company’s growing online ordering services.

Over the upcoming weeks, Hy-Vee is transitioning several of its Hy-Vee Market Grille restaurants to Hy-Vee Market Grille Expresses. At the Hy-Vee Market Grille Express, customers will be able to quickly order food, pay at a nearby pay station, then sit and enjoy their meal in a casual self-service, contemporary atmosphere. Each Hy-Vee Market Grille Express will offer a full-service bar where customers can enjoy a variety of beverages while watching their favorite game or sporting event on TV. The Hy-Vee Market Grille Express concept also allows customers to have a more convenient and quick eating experience if they are “on the go.”

In addition, Hy-Vee will soon be making an announcement about the opening of its first Wahlburgers restaurant. In August, the company announced that it would build, own and operate 26 Wahlburgers, making it the chain’s largest franchisee.