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As Minneapolis booms, can the city preserve places where people actually make stuff?

Wall has proposed saving the Harris building and turning it into a food hall.
MinnPost photo by Peter Callaghan
John Wall has proposed saving the Harris building and turning it into a food hall.

If you look north from the corner of Malcolm Avenue SE and the University of Minnesota Transitway  — the busway that runs between the U’s Minneapolis and St. Paul campuses — you can see one of Minneapolis’ largest industrial zones: the Southeast Minneapolis Industrial area, aka SEMI.

To the northeast is the Surly Brewing complex which — despite its hip beer hall and brewer’s table — is also a manufacturing facility. Semi-trucks frequently drive up and down Malcolm Avenue, servicing the warehouses and light industrial and supply companies in SEMI, businesses that have populated the railyard area north of Prospect Park for decades.

But if you turn just 90 degrees to the west, you can see what the area could become. Cranes and construction vehicles are visible at the site for “The Rise” — a mixed-use project that will hold 336 apartments and a grocery store on land that once held an ice cream factory, just the latest in a line of residential buildings that have been marching from the U of M campus toward Prospect Park.

In between the two vistas, though, is another site: a lonely group of buildings that might become the epicenter of a land-use evolution in Minneapolis. The onetime home of the Harris Machinery Co., the collection of brick and wooden structures is snuggled up against the landmark “United Crushers” grain elevator complex and is zoned for industrial use, meaning it’s been set aside by the city’s comprehensive plan for job creators.

Which poses something of a dilemma for Minneapolis: As residential development continues to boom, should the city allow the edges of its industrial areas to be turned over to housing, preserve them for uses that might provide jobs, or create something in between?

Malcolm Yards

John Wall has been interested in this part of Minneapolis for 15 years. In the early 2000s, he began buying property in the SEMI area with a vision to develop a technology and research campus that would attract businesses who wanted proximity to the U of M’s own research functions. “The University seemed in favor of it and I was surprised no one had thought of it before,” Wall said last month.

What he termed the Minnesota Innovation Park would provide a home for startups trying to take university research and discoveries to market. But after more than a decade of trying, Wall found that no one was buying what he was selling. The university’s interest was tepid, even when the school built a series of life sciences research buildings north of the football stadium. “I can’t take it anymore,” Wall said. “I can’t keep beating my head against the wall. I have to do what other people are doing.”

So for the last year or more, Wall has been proposing something different, a project he calls Malcolm Yards, which would include the property that holds the remains of Harris Machinery. After talking to the Prospect Park Neighborhood Association and other groups with interests in the area, Wall has proposed saving the most prominent building, the Harris building, and turning it into a food hall: a place where small restaurant counters might mix with bakers, wine sellers and even produce markets would be the anchor of a residential tower upwards of 14 stories.

The Prospect Park association supports Malcolm Yards, both the reuse of the Harris Building and the apartment tower. A memorandum of understanding between Wall’s company, Wall Development Co., and the association calls for retention and adaptive reuse of both the Harris Machinery Building and the United Crushers, and calls for a requirement in land use rules for a “certain amount or percentage of industrial/maker space.”

City action needed

There’s a problem with Wall's proposal, though: Under current Minneapolis zoning and policy, residential development is not permitted there. What's more, the property is part of an industrial zone, known as an Industrial Employment District, that makes changes in zoning difficult. In fact, Minneapolis would have to amend its comprehensive plan to allow the full Malcolm Yards development.

Cam Gordon, who represents the area on the Minneapolis City Council, said he has met with the developer and the neighborhood group and says the proposal raises a “key policy point” that the city needs to reconcile. “We’ve really held firm in keeping that as a designated employment zone,” Gordon said of the SEMI area. And while he said it is worth having a discussion about whether the zoning lines should be moved, or whether a new employment-residential zone should be created, he said the best time for that discussion might be during the upcoming update of the city’s entire comprehensive plan.

“As that area is changing and growing and things are coming in, there’s a different balance we could strike,” said Gordon, who also said he could imagine a transition zone that features “makers-spaces” where a craftsperson could design and build and live; if successful, the business could eventually move to larger-scale manufacturing areas in the SEMI area.

The onetime home of the Harris Machinery Co.
MinnPost photo by Peter Callaghan
The onetime home of the Harris Machinery Co., a collection of brick and wooden structures snuggled up against the landmark “United Crushers” grain elevator complex.

But that’s not what Wall is proposing to do; he wants to build apartments on the same campus as the food hall and some commercial space. “I think it’s a tough spot we’re in,” Gordon said.

No formal proposal for a comprehensive plan amendment has been made, and Gordon said he can’t guess the result if they council should take ever take a vote on the issue. But last summer, the council approved a $300,000 grant to Wall from the state of Minnesota for a now-abandoned plan to put a craft distillery in the Harris building. At the time, a $5.4 million price tag was put on the food hall and office portion of the project.

And just last month the council approved another development grant for the Harris Building from Hennepin County. The $300,000 grant would help pay for utilities, site work, sidewalks, trail connections, stormwater and building stabilization. And yet, though the 12,200 square-foot food hall would likely accord with the area’s current zoning, Wall has said the project only works if is also allowed to build his residential project, which is not allowed under current zoning rules.

By approving the grants from the county and the state, did the council tip its hand that it will support the comprehensive plan change? “Not that I know of,” responded City Council Member and Community Development Committee Chair Lisa Goodman when asked about the issue.

Zoning for jobs

The Metropolitan Council oversees growth management and long-range planning for the seven-county metro region. One of its policy goals, outlined in the council’s Thrive MSP 2040 plan, is to establish and preserve space for industry. The region, it notes, is expected to add 550,000 new jobs between 2010 and 2040.

“Just as the region’s residents need housing, so do the region’s businesses and institutions need land to locate their enterprises and jobs,” says the plan, which also notes that half of the region’s jobs are located in what it terms “job concentrations” with access to transportation networks, materials, markets and talent. “Proximity to workers — particularly via attractive commute modes — increases employers’ desirability as places to work and minimizes the negative impact of travel time delays,” it states.

To respond to that need, the report tasked cities to preserve places for employment, including industry, distribution and manufacturing. Unlike other aspects of the 2040 plan that are required for Met Council approval, however, the employment zoning one is not mandatory. 

Long process for neighborhood

Like Wall, a lot of neighborhood advocates have been wondering about the future of Prospect Park for awhile now. People like Richard Gilyard, an architect who has long been involved in planning for the Prospect Park neighborhood. If there’s been a committee or a workgroup or a new organization to put planning into practice, Gilyard has likely been a member.

While the approval of the Green Line LRT through the area provided an impetus for broader thinking about the area, Gilyard said there has long been a need to think strategically about development there, rather than simply reacting to each development proposal brought before the neighborhood association.

Described by Gilyard as progressive and “a far-left” kind of community (“the Paul Wellstone posters are still in the windows,” he says), Prospect Park was once known more for what it was against than what is was for.

“That was helpful for a lot of the proposals that were out there,” Gilyard said. But that has been changing. “We thought, development is going to happen here with us or without us.” It would either develop as a “stretch version of Stadium Village — more pizza, more beer, more maroon and gold — or it could be a different place.”

What’s emerged from the committees and studies and plans that Gilyard and many others have been involved in crafting over the years, then, is a vision for a decidedly urban community — one with commercial, office, residential, and work spaces that bring the sort of density that could draw the amenities and vitality the area had been lacking.

Under that vision, 4th Street, which had historically been an industrial area, would become a residential one, with up to 2,500 new units of varying affordability. While the area north of 4th, including Wall’s property, would be a job-creating space, with a mix of offices, studios, and incubator spaces.

the Southeast Minneapolis Industrial area
Prospect Park 2020
An aerial view of the area with the Harris property just right of the transitway and left of the United Crushers elevator. the lines show the University Avenue District..

“The real opportunity then becomes, how do you take this mix of uses, this mix of people and demonstrate how this can become a living laboratory demonstration of how we really have to do urban redevelopment,” Gilyard said.

The SEMI area poses one of the most complex, and interesting, challenges. Gilyard said that the city had hopes that it would redevelop into a research and innovation park. It didn’t. “Why they didn’t do more with it, I don’t know,” he said. “But in the end, it’s fortunate that they didn’t because you really have a blank canvas here in the middle of the city next to one of the largest  research institutions in the country and on the Green Line.”

While the neighborhood once opposed student housing in the southern segment of the SEMI area, it is now more open to some residential there. “With 4th Street becoming a residential street and with the creation of a park running back to the elevator, Prospect Park is supportive of the notion that you should have eyes on the park,” Gilyard said.

But they also want employment. “Somehow we have to be able to guarantee that there’s still job creation,” he said. The promise of the Green Line, that it would spur the creation of both affordable housing and jobs, has delivered more on the housing side than the jobs side. “This area cannot become all apartments. We don’t want it to be that. We want it to be a place of jobs.”

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Comments (24)

Interesting

Good piece, it seems closely related to this one.
https://www.minnpost.com/politics-policy/2017/01/cost-doing-business-how...

How is Minneapolis and St Paul going to attract good paying jobs for the non-college bound?

I mean with the Ford plant gone, are they going to cater to residential and college educated or are they going to attract something to reduce the current high minority unemployment rate?

Whut?

College educated OR minority? Why is that an "or"?

Well

Well, I think you will need to ask the Parent(s) and Public Education System that are failing the children they are responsible for raising and educating.

I continually advocate for society to hold Parent(s) and the Public Education System accountable for ensuring that all children graduate High School mature and academically successful, however I seem to be a lone voice in the wilderness... :-)

Part of a bigger picture

It seems that Minneapolis has long been headed away from industrial activity and towards boutiques along with the occasional suburban-style centers that have big parking lots and big box stores. In my experience, neighborhood organizations dislike industry.

Most of the remaining or new industrial companies have gone out to the suburbs, including even warehousing and wholesale outfits. Take as an example, electrical supply houses. I think Graybar may be the only one that remains in the central city.

Reversing commutes

One of the nice things about renewed interest in city living is preventing everyone from spending an hour in the car every day. What a shame if we just end up reversing the entire thing and we all drive to the suburbs every day.

It's not as though you can sustain a diversified city economy by having everyone just live there and sell things to each other.

Reverse commutes

I spent an hour a day reverse commuting from home in Minneapolis to various suburbs through my entire working career in engineering. Not that this is a good thing. It's just not a new phenomenon. I would have loved to be able to work in town, but large manufacturing operations just seem to be inherently suburban.

Don't Forget Viking!

Viking Electric supply has it's distribution center on Industrial Blvd. Based on nothing but a hunch, I suspect Viking is a shade bigger (by sales) than Graybar.

Negative Business Environment

There are many reasons why an employer decides to locate in a specific area, and one of the most important is the political environment. Any employer who has a choice of locations will be uneasy about the hostility of the Minneapolis city government to private sector employers, and the desire of politicians there to try to legislate Utopia at the local level. Any aspiring politician in one-party Minneapolis knows that he has to support a mandatory hourly wage of $15 or more, along with enhanced leave policies. There is no heed given - none - to the possibility that some employers in competitive markets don't have the pricing power to pay those wages and benefits. And all employers are asking themselves what is next as Minneapolis politicians try to outbid each other for left-wing votes by promising the most free stuff, i.e. stuff that others pay for.

A friend worked as an urban planner in Minneapolis for several years, and I know her to be pretty much down-the-line liberal. She said that during staff meetings she was usually the token "conservative" - the only person who even raised concerns about attracting and retaining private sector employers. The other planners just yammered on about creating more bike paths and green space and other trendy causes.

What

What !!! Are implying you need good jobs and a tax base to support that utopia? :-)

I am often amazed at how much light industrial there is in my city. (ie Plymouth) They seem to be doing something right.

AS....

As the manager of a light industrial business in Plymouth I can tell you it ain't the capitalistic wisdom of the city fathers. It is a happy coincidence of geography and land availability. Leave a crate on a loading dock: expect a complaint, put up a sign for a 3 day open house, expect a complaint, fork lift a crate across the street, expect a complaint. They are not substantially different than their Minneapolis brethren: a lot more proud and protective of a 6' wide asphalt trail than a building full of good paying jobs that they are only vaguely familiar with.

Someone

Well someone kept the center of Plymouth near 55 & 494 wide open for business. And I don't hear about the city council trying to legislate sick time, higher minimum wages, employee scheduling and/or letting people rezone the business areas for residential...

Except at 55 & Vicksburg where they ripped down a couple of plants to make room for retail...

I do agree that many people in MN seem to underestimate how important the manufacturing, mining and agricultural sectors are to the wealth of their community. They seem to think that service jobs are self powering, kind of like a perpetual motion machine. Where as they truly need some high "value add" businesses to drive them.

As much as I agree

As much as I agree Minneapolis is creating an hostile business environment, (to which I'd add all the ordinances on what you have to sell and what kind of bags / packaging you can use, the indifference o police to petty crime, and the disruption protesters are causing by illegally blocking the freeways at will), I think it's more just economics that if you want to make widgets, there's plenty of cheap land and single story office/warehouse type buildings with parking in the suburbs. Unless this changes trying to make an old multi-story building in the city work isn't going to be as attractive.

Business environment

Minneapolis's unemployment rate hovers around 3 percent - better than the state and country as a whole. It's funny - legislators from outstate are trying to limit what cities can do. Maybe instead they should look to Minneapolis's elected officials to see what they are doing right.

Source Please

I keep hearing from Left leaning sources is that there is a significant unemployment problem with regard to minorities in the cities and first tier suburbs. Are they incorrect? Thoughts?

Too bad

We have gone from everything being downtown to nothing being downtown.

Transit is currently in flux, so wait a bit.

The shift to autonomous vehicles will revolutionize transit and where people live. It will change how people and business think about where they are located. When a worker does not have to live on/near transportation--and an employer does not have to be located near public transit systems--that frees both to be located where they choose and they can still work together.

Is that aerial view correct?

It seems to be the University Avenue Innovation District rather than SEMI.

Thanks

We have clarified the cutline.

A relevant example?

Several years ago as I walked through part of the Prospect Park neighborhood I stopped at the long-established construction and mining equipment firm Ruffridge & Johnson, on 4th St. SE, just north of University Avenue. An official neighborhood meeting would soon take place regarding roadways, and although I do not live in that neighborhood, I thought it might be interesting to see if the folks at that firm knew of the meeting concerning matters that might concern them. Neither anyone from Council Member Gordon's office nor from the neighborhood organization had informed them. As a frequent passer-by, it seems to me that Ruffridge & Johnson is the kind of well-kept and well-run business that a city and neighborhood would value.

SEMI (Juxtaposition?)

Back in the early 80's the twin cities was a hub of semiconductor oriented innovation, Control Data, Sperry, MCT, Cray Research, etc. etc. What happened? The world changed and evidently in many respects these folks couldn't keep up with the changes. Not sure there is anything really new here, this type of industrial change has been happening for 100's of years. Manchester UK at one time was an industrial power house, New England similar, however the locomotive and steam age, yielded the automobile and aviation age, the coal, nuclear age is yielding to the Gas Turbine, renewable age. Semiconductor manufacturing started to move from the US to the Far east in the 70's because of labor, building, real estate and environmental concerns, ironically some of it is starting to move back because of IP and start up cost (read trained labor) concerns. But to address the question, perhaps the best answer is, what are the selling points of this area? Seems all the discussion was on, land availability, not so much on labor resource expertise, there is a reason that medical, finance etc. is concentrated in the area, just as much as there was a reason milling and lumber were concentrated in the area 150-70 years ago. Resources, some natural, some labor, some entrepreneurial, some business climate. The irony is that lots of folks, including the park and recreation board, with the above the falls plan, are trying to shut down the industrial area north of Broadway along the river, does that mean, scrap yards, concrete manufacturing and asphalt shingle manufacturing will be welcome there? Especially with all the noise, pollution, heavy traffic etc. Be careful what you wish for.

Options

Unfortunately there are many kids who are being left behind by our public schools and their Parent(s). This is especially bad in Mpls. St Paul and the first tier suburbs. The question is where do you want them to work when they drop out or barely graduate?

Light industrial, equipment assembly and warehousing have historically provided pretty good options for many... But they do come with trucks, some noise, traffic, etc. And better jobs. :-)

The article and aerial picture are deceiving...

The die is already cast. If you look at the highlighted area in on the map, everything East and South of the Harris building is essentially new construction dedicated to light industrial uses. Go to the West side of Harris and we get to the long debated Steel Silo area that will end up as a U of M something as they own the land. That only leaves the Harris warehouse block ripe for development and if the owner is willing to invest money in ANY sort of conversion the city should welcome it: go East and it is industrial, Go West and it is U of MN research buildings, go Southwest and it is housing. Take whatever can be had there and move on. The food use seems ideal, Surly to the East and 50,000 hungry and thirsty students to the West.

real estate developers are part of the problem

I'm sure Wall believes what he says about wishing small industry would fill out this area, but his "developer first" approach is part of the problem.

This area is already zoned industrial, thus there were no regulatory issues about putting a fledgling industrial business in this area. However, when a speculative landlord like Wall swoops in and buys up most (or all) of the property, it effectively puts a lot of smaller players out of the running for leases. Only large deals and project make sense. The landlords then just sit on the property until some massive project gets green lighted. Meanwhile, anyone needing a smaller space immediately is forced to look in the first ring burbs, with tons of industrial, office and warehouse buildings.

You see this development pattern all over Minneapolis and indeed, all over the country.

I agree...

In most cases with your point, the unique thing about this property is that it is in a total state of decay: the existing buildings are simply not suitable for occupancy. The only way to get them to a state of suitable use is restoration and/or demolition and new construction. A single development plan for a 2 block square area would seem to make the most sense and be most likely to attract investors. If you look to the East of the site you find lots of newer, multi tenant, light industrial buildings planned and built by developers and occupied by smaller players.