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Projects to Watch

Building Buzz: January 15 - 19

posted on 01.22.2024

We're reading the headlines so you don't have to.

From OSHA civil penalty increases, economic signals to watch for in 2024, to new projects in development and/or under construction, here's what was buzzing in the building world from the week of January 15-19, 2024:

 

CIRCLING BACK
Industrial development planned for Rogers
Three new industrial warehouses may be coming to Rogers, as West Development has plans to build a new development, according to public documents. As detailed in an environmental assessment worksheet, the location of the development would be near the intersection of 147th Avenue and State Highway 101 in Rogers. The plat of land does not have an assigned address and is valued at %5.45-million, according to Hennepin County tax information. The land sits in the northwest submarket of the Twin Cities metro and would back up to the Crow River. It is owned by the Edina-based Schmidt Crow LLC.  (12-27-2023  |  Finance & Commerce)
 

JANUARY 12, 2024
Kowalski's buys site of future store near Ridgedale
Kowalski's had paid $4.9-million in cash for a former Sears auto repair property in Minnetonka, the site of its future grocery store near Ridgedale Mall and the new Dick's House of Sports. The grocer purchased the property from Ridgedale TRS Sub LLC, an entity related to Ridgedale Mall owner Brookfield Properties Retail of Chicago, according to a certificate of real estate value made public. Located at the 12439 Wayzata Boulevard, the property has an estimated value of $8-million for tax purposes, according to Hennepin County records. (1-12-2024  |  Finance & Commerce)
 

Not all carbon-capture projects are created equal
Capturing carbon dioxide from the air or industries and recycling it can sound like a win-win climate solution. The greenhouse gas stays out of the atmosphere where it can warm the planet, and it avoids the use of more fossil fuels. But not all carbon-capture projects offer the same economic and environmental benefits. In fact, some can actually worsen climate change. (1-12-2024  |  Finance & Commerce)
 

OSHA and MSHA civil penalty amounts get annual bump
OSHA's maximum penalties for willful or repeat violations will be increasing approximately 3.2%. The 2024 increases --- to $161,323 from $156,259 in 2023 -- are legally mandated by January 15th each year under the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. Because January 15th is a federal holiday, this year's changes will be effective starting January 16th. (1-12-2024  |  Safety and Health Magazine)
 

Q & A: Rochester Destination Medical Center effort at its half-way point
The Destination Medical Center is the largest private-public partnership in the state of Minnesota. At its core, the initiative is a promise between the city of Rochester and the Mayo Clinic, the state's largest employer. It was a promise formulated as a 20-year project back in 2014, meaning the partnership is at its midway point. (1-12-2024  |  Finance & Commerce)
 

Sustainability rules move forward for Milwaukee County Projects
Milwaukee County will add a climate scoring system into its annual budget cycle criteria for building projects. The county Capital Improvements Committee (CIC) voted 6 - 1 to approve a scoring system that measured reduced emissions, improved climate resiliency for buildings and co-benefits such as workforce development plans and disaster preparation. The scoring system will be added to existing criteria the county uses when assessing capital projects. (1-12-2024  |  Finance & Commerce)
 

JANUARY 15, 2024
Building codes and reliable infrastructure help prevent snowstorm disasters
Winter storms can easily become billion-dollar disasters as the snow piles up on interstates and collapses roofs and power lines. Yet, while cancelled flights and business interruptions can't be avoided, what turns a snowstorm into a disaster often can be. One snowflake at a time, wet snow can pile up to a weight of 30-pounds per cubic foot on a rooftop --- enough to collapse a structure that is too light or not well designed. Although roof collapses are relatively rare, they are expensive and can take months to repair. (1-15-2024  |  Finance & Commerce)
 

Conflict in Red Sea inflating shipping rates
Since December, global media have reported attacks --- at the Red Sea's southern end --- on commercial ships launched by Yemen's Houthi group. The risk of piracy has caused shipping companies to avoid the route, which involves utilization of Egypt's Suex Canal on the Red Sea's northern end. Crude petroleum input prices were down 13.2%, while unprocessed energy materials were down 9.1%. Natural gas prices rose 1.5% in December. Overall construction input prices are 1.2% higher than a year ago, while non-residential construction input prices are 1.6% higher. (1-15-2024  |  Construction Briefing)
 

Minnesota at the forefront of diversity in engineering
Minnesota has been a leader in the effort to attract more women and people of color to the engineering and design services industry --- and that's good news as firms struggle to fill open positions, a prominent voice of the industry says. Jonathan Curry, executive director of the Minnesota Chapter of the American Council of Engineering Companies, shares thoughts of a recent DEI&B survey, which shows that engineering firms have room for growth when it comes to diversity. The "Diversity Roadmap" survey from ACEC's Research Institute, conducted last summer, attracted responses from nearly 200 ACEC member firms. (1-15-2024  |  Finance & Commerce)
 

Year ahead looks bright for development in Plymouth
Housing construction activity in Minnesota's busiest markets plunged last year, with housing permits down 40% across the 13-county metro plus Rochester. Other sectors were down too, beset by high interest rates and rising construction costs. Plymouth bucked this trend. The city permitted 137 new single-family homes in 2023, up from 99 in 2022. It approved two new multi-family communities last year after green-lighting none in 2022. 2024 is shaping up to be an even bigger year for development activity in Plymouth. (1-15-2024  |  Finance & Commerce)
 

JANUARY 16, 2024
Ahead of legislative session, Walz pitches $982-million in public construction projects
Governor Tim Walz rolled out his $982-million plan for public construction projects, a package that spans from prison fixups to dedicated busway expansions to projects that better connect Minnesotans to their natural resources. He emphasized the ongoing need to fund the construction and maintenance projects. Projects on his list also ranged from wastewater treatment plant replacements to ice rinks to flood mitigation. (1-16-2024  |  Minnesota Public Radio - MPR)
 

Backlog increases amid easing credit conditions
Construction backlog ticked up in December to 8.6 months due to improving financing availability, according to a release from Associated Builders and Contractors. The metric is still rebounding from a backlog level of 8.4 months in October, its lowest point since the first quarter of 2022, according to ABC. The December increase, however, has sparked some confidence among contractors, due to two consecutive months now of backlog growth. (1-16-2024  |  Construction Dive)
 

Construction input prices drop 3 months in a row
Construction input prices fell 0.6% in December largely due to plunging oil prices, according to a new Associated Builders and Contractors' analysis of U.S. Bureau of Labor Statistics Producer Price Index released January 12. The decrease marks three consecutive months of price moderation, though volatility still remains in the cards, said Anirban Basu, ABC chief economist. Overall construction costs remain 1.2% higher than a year ago, while nonresidential construction input prices are 1.6% pricier. (1-16-2024  |  Construction Dive)
 

David Mortenson on Twin Cities construction: More cranes are good, fewer are bad - but it's complicated
David Mortenson's key economic indicator in construction is typically this: More cranes on the skyline are good, fewer are bad. But it's been a bit more complicated than that. Mortenson, chairman of Golden Valley-based M.A. Mortenson Co. --- one of the largest construction firms in the nation --- shared his outlook for the U.S. construction industry at a conference hosted by the Federal Reserve Bank of Minneapolis. (1-16-2024  |  Minneapolis-St Paul Business Journal)
 

Economists highlight 3 major economic signals to watch in 2024
As 2024 unfolds, economists and other experts in the financial and housing markets suggested a few major factors that could be turning points, good or bad, for the U.S. economy. Here are those three themes --- the possibility of a recession, consumer spending slowdown, and a housing rebound --- along with some observations on each of them. (1-16-2024  |  Finance & Commerce)
 

Ramsey County OKs sale of TCAAP outlot in Arden Hills to Ryan Cos.
The board unanimously approved the purchase and sale agreement with Ryan for an outlot, known as Outlot A, of Rice Creek Commons, the name of the redevelopment site for the 427-acre former TCAAP.  Ryan's plan for the site is a build-to-suit property accommodating 400,000 to 600,000-square-feet, according to a county press release. This could include a corporate campus, life sciences offices, a research and development center, or manufacturing and distribution facilities. It's also expected the plan would include on-site retail and restaurant space.  (1-16-2024  |  Minneapolis-St Paul Business Journal)
 

Slumberland outlet to become early education center
Oakdale-based Slumberland Furniture is slashing prices even more than usual at its St. Louis Park Clearance Outlet as it prepares for a new owner to redevelop it into a Spanish immersion early education center. Edina-based TOLD Development paid the furniture retailer $2.6-million for the store at 4140 Excelsior Boulevard. (1-16-2024  |  Finance & Commerce)
 

JANUARY 17, 2024
Construction experts suggest being proactive with ESG policies
As employees, tenants and investors give more consideration to a business's environmental, social and governance (ESG) practices, construction and real estate companies need to be proactive with their strategies and policies, according to industry experts. Traction for ESG concepts is increasing and the willingness of a business to embrace implementation can attract workers, tenants and customers while also providing long-term cost efficiencies. (1-17-2024  |  Finance & Commerce)
 

Five construction tech innovations from CES 2024
The focus of this year's Consumer Electronics Show (CES) showcased ways artificial intelligence and other breakthrough technology can boost productivity while also reversing environmental impacts and future-proofing industries like construction and agriculture. (1-17-2024  |  Construction Dive)
 

McGough pitches senior apartments at Blooming Central Station
McGough Cos. is proposing to build a 164-unit senior apartment building at the Bloomington Central Station development near Mall of America. The proposal represents a further refinement to McGough's previously approved revision to bring three residential apartment buildings to the development in place of three proposed office towers. The plans for this building depart slightly from that approved plan, with fewer units and no retail. The previous plan called for 250- units and 6,000-square-feet of retail. (1-17-2024  |  Minneapolis-St Paul Business Journal)
 

McGough plans senior apartments at Bloomington Central Station
The multi-family senior housing proposal comes from McGough, a Roseville-based group that has played a significant role in developing the area around Bloomington Central Station. It would be at 3001 American Boulevard East and be five stories with 164 units. The adults McGough is targeting with the proposed development are "active senior-adults". The location of the development would be ideal for adults because of its proximity to the amenities offered by the area around Bloomington Central Station. The unique amenities for senior housing might include a golf simulator, a woodworking shop area and small gathering spaces for group activities. (1-17-2024  |  Finance & Commerce)
 

Six trends that could shape US cities in 2024
Flying taxis, high-speed rail, emissions-free buildings and transportation" Some long-held dreams of urban futurists are moving forward in 2024. Cities also are taking advantage of increased federal funding and growing public sentiment to address some long-neglected issues, like the shortage of affordable housing and the impacts of climate change, especially on disadvantaged communities. At the same time, however, cities are confronting problems that stem from the pandemic: empty office buildings, hollowed-out downtowns and public transit systems hobbled by changes in commuting. In some cases, new technologies are providing new solutions; other new technologies, like generative AI, are cause for both optimism and caution by city leaders. (1-17-2024  |  Smart Cities Dive)
 

Study reveals asbestos exposure in construction
A research study has raised significant concerns about the dangers of asbestos exposure for workers in the construction industry. The study, published in the Annals of Work Exposures and Health, reveals that the installation and removal of asbestos cement products pose grave risks, with exposure levels far exceeding the occupational limited in the United States. Key findings of the study include: (1) When asbestos cement pipes are cut, the average exposure to asbestos is over 50 times higher than the short-term limit established by OSHA in the U.S., and (2) Asbestos cement products, including pipes, siding, and roofing, account for more than 90% of global asbestos use. (1-17-2024  |  For Construction Pros)
 

Summit Orthopedics plans 80,000-square-foot facility at Plymouth's Prudential site
The Woodbury-based health care company will be the sole tenant in a new two-story building on the northwest corner of the overall site, confirmed Dan Salzer, director of development for Indianapolis-based Scannell Properties, which is co-developing the site. Located on the corner of Interstate 94 and Bass Lake Road, the Prudential site is also being co-developed by Minnetonka-based Roers Cos. (1-17-2024  |  Minneapolis-St Paul Business Journal)
 

Upper Post Flats fina phase done
The final phase of the 192-unit Upper Post Flats, a $160-million development that turned landmark buildings at the Fort Snelling Upper Post into affordable housing, is complete after years of construction and planning. BKV Group, which designed the project for Dominium, sad the project is finished and "fully open to the public." Military members, veterans, first responders and their families get first priority in housing. The "below-market-rate rents" are designed to be affordable for households earning up to 60% of the area median income, BKV Group said. (1-17-2024  |  Finance & Commerce)
 

Walz pitches $982-million infrastructure bonding plan
Governor Tim Walz proposed a $982-million public infrastructure plan that includes a new headquarters for the Minnesota State Patrol but focuses mostly on the unglamorous task of preserving existing buildings and facilities. The package, known as a bonding bill, will be a centerpiece of the governor's agenda for the 2024 legislative session, which convenes February 12. Walz said his plan would protect drinking water, improve roads and bridges, protect public safety and support safe housing. (1-17-2024  |  Finance & Commerce)
 

JANUARY 18, 2024
330 apartment in Plymouth closer to construction
The Plymouth Planning Commission unanimously recommended approval of the project, which would also offer 12 rental townhomes and a 5,600-square-foot retail building with teh potential for adding another 5,000-square-feet, according to city documents. The vacant site is located on the north side of Highway 55 and along 10th Avenue North. The apartments, townhomes and retail space would be developed on separate newly created lots. (1-18-2024  |  Minneapolis-St. Paul Business Journal)
 

Cottage Grove OKs housing at 'gateway' to city
Roers Cos. has the final go-ahead from the Cottage Grove City Council to build a 144-unit mixed-income apartment building in the southeast metro suburb, a development that promises to boost the city's growing stock of affordable housing and enhance its architectural landscape. Given the site's high-profile location along Highway 61, the City Council urged Roers to go the extra mile on the aesthetics front. The resulting design --- which features a mix of stone, glass, specialty block and fiber cement exterior building materials --- got strong reviews from city officials. (1-18-2024  |  Finance & Commerce)
 

DEED: Minnesota construction job growth outpaces nation
Minnesota's construction industry added 1,200 jobs from November to December and continues to outperform the nation as a whole in that sector, according to data released by the Minnesota Department of Employment and Economic Development. In all, the state saw a net gain of 800 jobs during the past month, DEED said, adding that it was the sixth consecutive month of job growth. Leisure & Hospitality led all sectors with 1,800 jobs added, followed by Trade, Transportation & Utilities (1,500), Construction (1,200), Mining & Logging (300), and Financial Activities (100). In December, Minnesota's unemployment rate fell two-tenths of a percentage point to 2.9%, the U.S. rate remained at 3.7%. (1-18-2024  |  Finance & Commerce)
 

Rapid City Council approves $147M water reclamation facility upgrade
In a major step to upgrade the city's water infrastructure, the Rapid City Council approved $147-million for a second phase of improvements at the Water Reclamation Facility South Plant. The second phase of the project focuses on constructing new reclamation and water waste treatment facilities and processes. It includes the addition of an aeration basin, two secondary clarifiers, a dewatering building, a pumping building and all necessary equipment. The project also aims to improve the resilience of the facilities with backup generators and alternative treatment options. Renovations and modifications to various parts of the existing facility are also planned. (1-18-2024  |  Rapid City Journal)
 

University of Minnesota weighs Williams Arena renovation or replacement
The Pioneer Press, citing university documents, reports that the U of M has hired Populous, a Kansas City-based architecture firm known for its work on sports facilities, for a feasibility study of "possible renovation to Williams Arena (and Maturi) Pavilion or consider new construction." Williams Arena was built in 1928 and has been the home of the Gophers basketball teams for decades. (It also hosted U of M hockey before the construction of Mariucci Arena in the 1990s.) The Populous study will include options for suites and other premium seating, as well as better access for fans in the arena's concourses and restrooms. The current study is just at the conceptual level, though the firm will work with Golden Valley-based Mortenson Co. to prove cost estimates as options. (1-18-2024  |  Minneapolis-St Paul Business Journal)
 

Wisconsin Senate approves bill to shorten commercial building reviews
The Wisconsin State Senate passed several bills that would alter how state and local government would review commercial building plans. Bill supporters promised they would eliminate delays in the commercial building process, while state inspectors said maintaining the current system was important to public health and safety. In 2022, lawmakers introduced a similar set of bills that would have exempted single story buildings with 100,000-square-feet and buildings with 24 plumbing fixtures or fewer from state review. (1-18-2024  |  Finance & Commerce)
 

2024 Projects to Watch: The Twin Cities CRE landscape will be reshaped by these 12 properties
It's no secret the commercial real estate market was a volatile one in 2023. But that won't keep some projects form moving ahead in 2024. The volatility is largely attributed to heightened interest rates, declining values and lack of available financing. But here's some renewed optimism for this year, after the Federal Reserve signaled that interest rates would be cut in 2024. Here's where some of the top properties in the Twin Cities stand and where they're headed in the year to come. (1-19-2024  |  Minneapolis-St. Paul Business Journal)
 

Projects to Watch

Building Buzz: January 8 - 12

posted on 01.11.2024

We're reading the headlines so you don't have to!

From projects in development and under construction, economic outlooks for 2024, and new federal rulings on independent contractor classifications, here's what was buzzing in the building world from the week of January 8-12, 2024:

 

Construction outlook for 2024 a mixed bag as contractors struggle to attract, retain labor
Labor has been consistently cited as a top challenge for general contractors, an issue that long predates the Covid-19 pandemic. The construction industry added 17,000 net jobs in December, part of what was a stronger-than-expected jobs report released late last week by the U.S. Bureau of Labor Statistics. Between December 2022 and December 2023, industry employment grew 2.5%, to 197,000 new jobs, according to an analysis of BLS data by industry trade group the Associated Builders and Contractors. Still, the unemployment rate in construction continues to outpace the national unemployment rate, at 4.4% in December compared to 3.7%. (1-8-2024  |  Minneapolis-St. Paul Business Journal)
 

Labor crunch will continue to squeeze contractors
Nearly 8 out of 10 respondents to a new Associated General Contractors of America survey said they have a hard time filling salaried or hourly craftworker positions, but 69% still said they anticipate a "total increase" in headcount. A fifth of respondents said it will get harder to hire in 2024. Nonetheless, contractors will need those workers. In 14 of 17 sectors, respondents anticipated the dollar value of project they compete for to increase this year compared to 2023. (1-8-2024  |  Construction Dive)
 

Plan for 255 new homes advances in Lakeville
TEG Land Holdings LLC, an entity related to Twin Cities Land Development, wants to develop 255 new homes, including 127 attached townhome lots, 99 detached "villa" lots, and 29 single-family home lots, on a site north of 205th Street and west of Interstate 35. The Lakeville Planning Commission unanimously recommended approval of a revised preliminary plat for the development, known as Ritter Meadows. The plans will be up for review at the January 16th City Council meeting. (1-8-2024  |  Finance & Commerce)
 

Costco plans a store in Ostego along I-94
Costco Wholesale Corp. wants to build a store on a vacant property on the edge of Albertville and Ostego near Interstate 94. The retailer submitted a development application to the city of Ostego, according to City Administrator Adam Flaherty. City Planner D. Daniel Licht said the application will be tentatively considered at the February 5th Planning Commission meeting. The site is north of 60th Street Northeast between Interstate 94 and Maciver Avenue North. The development application shows the building will be about 164,000-square-feet and includes a parking lot with 938 stalls. (1-9-2024  |  Minneapolis-St. Paul Business Journal)
 

LGBTQ+ workers expect more inclusivity from employers
Every year, more and more companies seem to recognize Pride Month. But a recent analysis shows that LGBTQ+ workers expect more than this once-a-year acknowledgement from their employers. In fact, some employees actually criticize such behavior as mere pinkwashing. So, what do LGBTQ+ workers want? In 2023, the jobs website Indeed conducted a survey of LGBTQ+ full-time workers from across the U.S., and the results provide a clear picture of their needs. (1-9-2024  |  Finance & Commerce and The Conversation website)
 

Met Council hikes Southwest Light Rail budget to $2.86B
Officials leading the Southwest Light Rail project said that the cost to build a 14-mile train link between downtown Minneapolis and Eden Prairie has risen to $2.86-billion. The rail line's price tag has steadily increased over the years as its timeline has stretched out. What was once pitched as a $1.3-billion project, to be completed by 2018, is now expected to take until 2027. The ballooning budget has drawn scrutiny from legislators and auditors. A report last year criticized the Council for not holding contractors accountable for overruns. (1-9-2024  |  Minneapolis-St. Paul Business Journal)
 

Minneapolis called a model for housing development
Other cities take heed of Mineapolos and its zoning regulations. At least that's what researchers at the Pew Charitable Trust are saying in a report published last week. The report by the nonprofit's housing team says Minneapolis' zoning code adjustments have helped it better tackle housing issues while other major U.S. cities have fallen behind. (1-9-2024  |  Finance & Commerce)
 

New federal rule on independent contractors could trigger wave of lawsuits against businesses
Companies will potentially have a harder time classifying millions of workers as independent contractors under a new Department of Labor final rule. The new rule expands the so-called "economic reality" test so that employers have to weigh a wider variety of factors when classifying workers, including how much control the worker has over their schedule and their employment, how permanent their employment is, and how integral their work is to the work of the company, among the six factors employees must consider. (1-9-2024  |  Minneapolis-St. Paul Business Journal)
 

New labor rule tightens worker classification standards
The Biden administation entacted a new labor rule that aims to prevent the misclassification of workers as "independent contractors," a step that could bolster both legal protections and compensation for millions in the U.S. workforce. The Labor Department rule, which the administration proposed 15 months ago, replaces a scrapped Trump-era standard that lowered the bar for classifying employees as contractors. Such workers neither receive federal minimum wage protections nor qualify for employee benefits, such as health coverage and paid sick days. (1-9-2024  |  Finance & Commerce)
 

Construction planning numbers end 2023 on a high note
The Dodge Momentum Index, a benchmark that measures nonresidential construction planning, closed out the year with a 3% jump in December, buoyed by data center growth, according to the Dodge Construction Network. Over the month, both commercial and institutional planning improved 1.0% and 6.1% respectively. The gain reversed the 1.4% drop in November, when a slowdown in commercial planning pushed the index down, accroding to Dodge. That indicates support for construction activity this year, said Sarah Martin, associate director of forecasting for Dodge Construction Network. (1-10-2024  |  Construction Dive)
 

Duluth hotel development site sold in $2.7M deal
In a deal worth more than $2.7-million, Kinseth Hospitality Cos. has sold land in Duluth to D & D Real Estate Holdings, according to public documents. According to the documents from the Duluth Planning Commission, the land is for a four-story, 100-room TownPlace Suites by Marriott on Sundby Road north of West Page Street. The tract of land that has been traded is one that's been highly contested throughout the years. Neighbors and environmentalists are worried about the harm the development may cause to a creek near the land. The Duluth Planning Commission opted to require an Environmental Assessment Worksheet, or EAW, for the property. (1-10-2024  |  Finance & Commerce)
 

Eagle Brook gets green light for megachurch in Plymouth
After a divided vote from the Plymouth City Council, Eagle Brook has a clear path forward to construct a 64,000-square-foot church on a 53-acre site at 17910 Chankahda Trail. The megachurch threatened to sue the city if the council rejected the plans. The Council's 3-3 vote on a resolution opposing the project means the project can advance. Residents opposed to the project cite concerns about traffic, the size and scale of the building, and more. City staff recommended denial of the church's request for rezoning, preliminary plat, site plan, and other approvals. (1-10-2024  |  Finance & Commerce)
 

New Northtown owner plans more improvements at Blaine shopping mall
Felix Reznick, principal at 4th Dimension Properties, is adding an Imagination Station play area for children to the former D'Moxi space across from the food hall. The Imagination Station has a climbing area and other topys to keep kids busy. It doesn't pull a profit but could help attract more shoppers.  (1-10-2024  |  Minneapols-St.Paul Business Journal)
 

New St. Cloud mall owner: 'The dinosauers are dying'
The new owner of the 1980s-vintage Midtown Square mall in St. Cloud has big plans to turn the half-empty retail center into a multipurpose hub for everything from indoor sports to flex light industrial uses. An entity related to Brait Capital of Edina paid $8-million for the mall property at 3333 Division Street West, according to a certificate of real estate value made public. Lighthouse Management Group Inc. of St. Cloud is the seller. (1-10-2024  |  Finance & Commerce)
 

Biden awards $623M to states, tribes to build EV charging network
The Biden administration is awarding $623-million in grants to help build an electric vehicle charging network across the nation. Grants will fund 47 EV charging stations and related projects in 22 states and Puerto Rico, including 7,500 EV charging ports, officials said. Congress approved $7.5-billion in the 2021 infrastructure law to meet President Biden's goal of building out a national network of 500,000 publicly available chargers by 2030. The charging ports are a key part of Biden's efforts to encourage drivers to move away from gasoline-powered cars and trucks that contribute to global warming. (1-11-2024  |  Finance & Commerce)
 

Downtown Rochester luxury apartment fetches $37M
A luxury apartment building in downtown Rochester has a new owner in Northland Investment Corp., according to public documents. The Maven on Broadway, a six-story, 154-unit multifamily complex was purchased by the Newton, Massachusetts-based firm for $37.7-million. The seller is another Massachusetts group, Berkshire Resiential Investments, which is based in Boston. (1-11-2024  |  Finance & Commerce)
 

Milwaukee could finally take control of and redevelop Northridge Mall
The city of Milwaukee could take control of the abandoned Northridge Mall by the end of January and demolish the building in the summer. If the city acquires the vacant property through foreclosure, it would be an end to years-long litigation between the city and mall owner U.S. Black Spruce Enterprises. After the city issued a raze order in 2019, the mall has been the subject of city and state court cases, and incidents of both trespassing and arson. (1-11-2024  |  Finance & Commerce)
 

Lawsuit between Doran Special Projects, St. Paul apartment complex ends
A lawsuit between Bloomington-based developer Doran Special Projects LLC and Marshall Lofts LLC, the Hopkins-based business behind a St. Paul apartment complex, is over. Court records show that Doran moved to dismiss the lawsuit on December 12, 2023, after the case was referred to mediation on August 7, 2023. Doran first filed the lawsuit in June alleging Marshall Lofts never paid Doran for $812,798 worth of contracting work done at 2105 Marshall Avenue and 250 Finn Street in St. Paul. Those addresses are the locations of an apartment complex, also called Marshall Lofts, as well as an adjacent residential rental building called The Finn.  (1-12-2024  |  Minneapolis-St Paul Business Journal)

Projects to Watch

Building Buzz: December 25 - 29

posted on 01.02.2024

We're reading the headlines so you don't have to. From projects under construction, federal funding allocations, and employment reports, here's what was buzzing in the building world during the week of December 25 - 29, 2023:

 

Wayzata Schools buys Optum subsidiary Solutran's ex-Plymouth headquarters
The school district bought the two-story, 32,000-square-foot building, located at 13305 North 12tth Avenue for $7.75-million, according to a public real estate filing with the Minnesota Department of Revenue. (12-20-2023 | Minneapolis / St. Paul Business Journal)

Big deals found in multi-family, but 2023 still lags behind 2022 market
There is one thing to be said about the 2023 multi-family / apartment market: Nothing came close to the sale of the Berkman apartments in 2022. The Rochester apartment has kept its spot in the history books as one of, if not the highest single-asset multi-family transaction in Minnesota. 

But this year's champion for highest-value transaction belongs to Weidner Apartment Homes for the eight-building Inspire Apartments in Minneapolis' Uptown, which, if they had been bought at their taxable value of $162-million, would have put it up near the Berkman transaction. But they were bought at the relatively modest price of $111-million, a bargain for the new owners. (12-22-2023 | Finance & Commerce) 

McAlister's Deli is headed to Mankato, then Twin Cities with 10-unit agreement
McAlister's Deli is making its Minnesota debut in Mankato with plans for further expansion in the state. The national deli concept joins the state with a 10-unit franchise agreement. Other target markets include Apple Valley, Burnsville, Rochester, Albert Lea, Faribault, New Ulm, Northfield, Owatonna, and others. McAlister's Deli will land at 1860 Adams Street next year. (12-22-2023 | Minneapolis - St. Paul Business Journal)

Milwaukee receives $4M for safe street upgrades
Milwaukee will receive a $4-million grant from the U.S. Department of Transportation as part of its "Safe Streets and Roads for All" grant program. The city will use the funds for a safe street program tied with goals to eliminate traffic deaths by 2037. (12-22-2023 | Finance & Commerce)

A wave of minimum wage increases is on the way in 2024
The highest minimum wage by state ringing in the new year will be Washington, at $16.28, followed by California, at $16. The District of Columbia saw its minimum wage increase to $17 on July 1, 2023. Many states have either scheduled increases into minimum wage laws or have pegged them to inflation, triggering automatic bumps in their minimum wage rates. Minnesota increases to $10.85 for employers with annual gross revenues of at least $500,000 and $8.85 for employers will revenues of less than $500,000. (12-22-2023 | Minneapolis / St. Paul Business Journal)

Wells Fargo economists: No 'Goldilocks' economy for you!
Wells Fargo economists may not be running victory laps just yet, but their call earlier this year for big rate cuts in 2024 is now closer to market consensus. Or rather, market consensus is moving closer to Wells Fargo's outlook. The bank's economists shed more light this month on their outlook for the year ahead, reiterating their earlier call that the economy will slip into recession in mid-2024. (12-22-2023 | Minneapolis - St. Paul Business Journal)

Electric vehicles owners and solar rooftops find mutual attraction
When Jim Selgo moved to his home in Goodyear, Arizona in 2019, he quickly had rooftop solar installed, having had a positive experience with solar at his previous home. Less than a year later, motivated to take more action to address climate change, he said, Selgo bought his first electric vehicle, a Nissan Leaf. He hasn't paid for electricity or gasoline since. (12-25-2023 | Finance & Commerce)

Office market sluggish in 2023
"Flight to quality" continues to be the term to define the 2023 office market, with many companies scrambling to reduce their footprint, but to do so in buildings with the best amenities available/ But the year's capital market tells a different story. The second half of 2022 was described to Finance & Commerce as "pencils down" as interest rates continued to increase. That narrative continued this year, as transactions overall saw a dramatic fall. 2023 saw one transaction that breached $100-million. The next hightest? $50-million. Some office buildings, left behind by their traditional users, have been purchased to be converted into an apartment or a warehouse. (12-25-2023 | Finance & Commerce)

Solar canopy approved at Wisconsin union training center
Greenfield officials gave a thumbs up to the International Brotherhood of Electrical Workers (IBEW) Local 494's proposal to build a solar power canopy over part of its training center parking lot. The union wants to install a 104-foot by 20-foot solar structure to train apprentices and offset 90% of the training center's electrical usage, according to a city staff report. The size of the structure, which will be wide enough to cover 11 parking spaces, is based on the building's electrical usage. (12-25-2023 | Finance & Commerce)

DJR founder Dovolis urges architects to take risks
Is Dean Dovolis an architect or an inventor? Dovolis, founder and owner of Minneapolis-based DJR Architecture, appears to be embracing both roles as he devises new ways to team with partners to tackle affordable housing, economic and other disparities, and urban agriculture. (12-25-2023 | Finance & Commerce)

Construction economists cautiously optimistic for 2024
As the end of 2023 edges closer, experts shared their views on the state of the construction industry going forward. According to experts from the nation's leading contractor associations, certain parts of the construction industry fixated on manufacturing and infrastructure will continue to see prosperity, while some challenges like labor shortages will still likely be universal in 2024. One thing experts rejoiced about? The slowing of the Federal Reserve's interest rates; in mid-December, Jerome Powell, chair of the Fed, announced rates would stay between 5.25% and 5.55%. (12-26-2023 | Finance & Commerce)

Industrial market dipped in 2023
Transaction volumes were down across the board in commercial real estate. But the industrial market faired better than other specialized classes. The high points of this year's market didn't come close to last year's highest trade. In a 17-property portfolio trade from Artis REIT to Capital Partners and Investcorp, last year's highwater mark was $248.9-million. This year's was a seven-building recapitalization deal work $88-million between PCCP and Eagle Realty, while Capital Partners stayed invested in the property. (12-26-2023 | Finance & Commerce)

CP, West Development pitch three-building industrial project in Rogers
A pair of developers are proposing a new three-building, 557,000-square-foot industrial development in Rogers. The project, led by a joint venture between St. Louis Park-based West Development and Minnetonka-based CP Development, would be situated on a 45-acre vacant property along Highway 1010 and abutting the Crow River. (12-27-2023 | Minneapolis / St. Paul Business Journal)

Industrial development planned for Rogers
As detailed in an environmental assessment worksheet, the location of the development would be near the intersection of 147th Avenue and State Highway 101 in Rogers. The plot of land does not have an assigned address and is valued at $5.45-million, according to Hennepin County tax information. (12-27-2023 | Finance & Commerce)

Notable projects finished in 2023
Heading into 2023, Minnesota's construction industry wasn't exactly bubbling over with enthusiasm about market conditions for the coming year. Even though any eagerness was tempered by rising costs, labor shortages, and other headwinds, the past year saw work completed on some key public and private sector projects. Let's take a backward glance at a few of those projects. The list isn't comprehensive, but it offers a snapshot of notable projects in both the vertical and highway sectors. (12-27-2023 | Finance & Commerce)

WisDOT's year in review touts 350 road safety projects
The Wisconsin Department of Transportation (WisDOT) was busy in 2023, including completing the final leg of the Zoo Interchange and securing hundreds of millions of federal dollars coming to state road projects. Among the transportation agency's year in review was a third year of state transportation funding increases, money for studying more passenger rail routes and more than 350 projects funded for safety and road improvements. Several key items on WisDOT's end of year list were tied to the influx of federal funding for infrastructure projects. (12-27-2023 | Finance & Commerce)

The year in clean energy: Wind, solar and batteries grow despite economic challenges
Led by new solar power, the world added renewable energy at breakneck speed in 2023, a trend that if amplified will help Earth turn away from fossil fuels and prevent severe warming and its effects. Clean energy is often now the least expensive, explaining some of the growth. Nations also adopted policies that support renewables, some citing energy security concerns, according to the International Energy Agency. These factors countered high interest rates and persistent challenges in getting materials and components in many places. (12-27-2023 | Finance & Commerce)

Checking in on RiverNorth development plan
ION is building a $30-million manufacturing facility as part of a planned company expansion and relocation. Located on a 1.1-acre parcel at 201 West Broadway Avenue between Second Avenue North and Washing Avenue North, the new building will have 5,000-square-feet of office space on the ground floor and a much larger amount of production space on two floors above. An aboveground parking structure will attach to the building's rear. Groundbreaking is expected in October 2024. (12-28-2023 | Finance & Commerce)

Kelly Doran, Twin Cities real estate developer, passes away at 66
Twin Cities real estate developer Kelly Doran, who founded both Doran Cos. and Doran Group, died overnight on December 28, 2023, following a fight with cancer, a press release from the Doran Group announced. He was 66 years old. Doran, born in Duluth, was a leader in the multi-family housing industry, as well as in retail space. In 2007, he founded the powerhouse commercial real estate firm Doran Cos., which has three divisions --- Doran Development, Doran Construction and Doran Management. (12-28-2023 | Finance & Commerce)

New Milwaukee museum shifts groundbreaking as it pursues fundraising goals
The museum wants to move the current building from 800 West Wells Street and build a 200,000-square-foot, six-story museum in the nearby Haymarket neighborhood. At a Milwaukee County board meeting, museum officials said deferred maintenance added up to $100-million and noted aging infrastructure such as failing elevators, escalators and a water tower. The new $240-million natural museum will break ground next spring. (12-28-2023 | Finance & Commerce)

Big projects to watch in 2024
The coming year could be eventful for at least some construction businesses in Minnesota. State and federal funding is advancing housing projects, infrastructure work, and other construction in the metro area and beyond. In December, Minnesota Housing announced nearly $350-million worth of funding for affordable housing statewide. Labor costs, workforce availability, inflation and other concerns are still hanging in the air. But in general, the outlook for 2024 is "slightly more positive" than it was for 2023, according to a recent Associated General Contractors of Minnesota survey of construction businesses. (12-29-2023 | Finance & Commerce)

Minnesota State Office Building project will cost $454M; here's what that price includes
The Pioneer Press has a report on the big-dollar renovation and expansion of the 290,000-square-foot building near the State Capitol. The project, already underway, promises to expand the building to more than 456,000-square-feet, repair decaying plumbing and electrical systems, and improve accessibility and security for the 90-year-old property that serves as offices for state House members and the Minnesota Secretary of State. The nearly $500-million overhaul of the Minnesota State Office Building isn't expected to be finished until 2027, but expect to hear a lot about it between now and Election Day 2024. (12-29-2023 | Minneapolis / St. Paul Business Journal)

Projects to Watch

Building Buzz: December 18 - 22

posted on 12.26.2023

We're reading the headlines so you don't have to. From projects under construction, federal funding allocations, and employment reports, here's what's buzzing in the building world from the week of December 18 - 22, 2023:

Highway 210 project receives federal funding
The upcoming Highway 210 / Washington reconstruction projects in Brainerd received federal funding. U.S. Senator Amy Klobuchar and Tina Smith announced on December 11th, the U.S. Department of Transportation awarded $25-million to the project. The money is provided through the department's Multimodal Project Discretionary Grant program, and it will allow the Minnesota Department of Transportation to address safety concerns along the thoroughfare. The project --- estimated around $45-million --- is planned for 2026-2027 and will see the reconstruction of Highway 210 / Washington Street between Baxter Dreive and Pine Shores Road in Brainerd. (12-11-2023 | Brainerd Dispatch)

Catalyst Construction breaks ground on Mayfair Medical Commons
Milwaukee-based developer Irgens announced construction has started for Mayfair Medical Commons, a new 45,823-square-foot medical building in Wauwatosa. The building is part of a larger redevelopment planned for a prime infill site south of the Research Drive entrance into the Milwaukee County Research Park, officials said. The project calls for a two-story, steel frame structure with a flexible interior design. Ample signage will give many users bidding opportunities, less than a mile from the Milwaukee Regional Medical Center and access to Interstates 94 and 43. The Sigma Group provided civil engineering services. (12-12-2023 | Daily Reporter)

Enclave Cos. pitches 200 apartments, day care in Bloomington
Enclave Cos. is proposing to construct a 201-unit apartment building and detached day care in Bloomington. The Fargo, North Dakota-based developer is expected to present plans to the Bloomington Planning Commission next week. The project is proposed for a vacant site located at 6701 West 78th Street, which once housed a Life Time Fitness facility, according to city documents. The property owner is a business entity tied to Chanhassen-based Life Time. (12-15-2023 | Minneapolis / St. Paul Business Journal)

Minneapolis secures $20M for traffic safety measures
The U.S. Department of Transportation recently awarded the city of Minneapolis $20-million as a part of its "Safe Streets and Roads for All" grant program. The city will put the funds toward its Vision Zero program, which aims to reduce traffic collision deaths to zero by 2027. (12-15-2023 | Finance & Commerce)

The 2021 infrastructure bill put $5B toward and EV-charging network. The first station just opened.
On the western outskirts of Columbus, Ohio, two doors down from a Waffle House, is a truck stop that, as of recently, has the first electric vehicle charging station in the country to be financed in part by the 2021 federal infrastructure law. The Pilot Travel Center at I-70 and U.S. 42 has four charging ports. They are part of a partnership between General Motors and Pilot that the companies say will lead to chargers being installed at 500 Pilot and Flying J locations. (12-16-2023 | Fast Company)

Woodbury authorizes $800k clubhouse renovation at Eagle Valley Golf Course
The Woodbury City Council authorized a contract on December 13th with Minneapolis-based Kraus-Anderson Cos. Inc. to carry out an $800,000 renovation to the clubhouse at Eagle Valley Golf Course. The contract still needs to be signed by Woodbury's mayor and city administrator, which Dan Morris, recreation enterprise manager for the city, said he expected to happen this week. The $810,561 will come from the course's $2.8-million annual budget. (12-16-2023 | Minneapolis / St. Paul Business Journal)

Affordable housing project in Edina advances with MN Housing funds
Solhelm Companies' plan to bring 89 units of affordable housing to Edina appeared to be stuck in the mud just six months ago, but things are looking up as it's one of the big winners in the latest round of funding announced by Minnesota Funding. The project, known as 5780 Lincoln, will offer homes affordable to households at 50% or less the area's media income. The new apartment building will replace the old Londonderry Office Park at 5780 Lincoln Drive, as previously reported. (12-18-2023 | Finance & Commerce)

Alliant Energy completes 623-acre solar project in Wisconsin
Madison-based Alliant Energy announced the completion of a 99-megawatt solar array in Waushara County. "The completion of this project is a major accomplishment that will deliver safe, reliable, cost-effective energy to our customers for decades," Ben Lipari, assistant vice president of resource development at Alliant, said in a statement. (12-18-2023 | Finance & Commerce)

Convenience store chain making $151M of Wisconsin capital investments
Convenience store chain Kwik Trip plans to invest more than $151-million in an expansion of its Wisconsin operations, state officials announced. The company, according to the Wisconsin Economic Development Corp., intends to: (1) Expand its dairy, commissary and baking facilities in La Cross; (2) Purchase an renovate a commercial office building in Onalaska; and (3) Construct a new satellite distribution center. (12-18-2023  |  The Construction Broadsheet)

Glen Taylor to donate $172-million for Minnesota and Iowa rural development
Glen Taylor, the state's richest man and the current majority owner of the Minnesota Timberwolves/Lynx organization as well as the owner of the Star Tribune, announced that he is donating $172-million to support people in southern Minnesota and rural communities across Minnesota and Iowa. The donation is the first phase of a larger charitable plan to support childhood education, rural community-revitalization, environmental sustainability and the social well-being of families in need and aims to create financial framework to support these and other causes. (12-19-2023 | Minneapolis/St Paul Business Journal)

Kowalski's is headed to Ridgedale Center
Local grocer Kowalski's Markets is heading to Minnetonka's Ridgedale Center. The Woodbury-based grocery store will be located in the 25,600-square-foot space previously occupied by Sears Auto Center. The family-owned and -operated grocery store is set to open sometime in 2025. (12-19-2023 | Minneapolis / St. Paul Business Journal)

Minnesota DLI alleges 'widespread wage theft' on 19 projects
The Minnesota Department of Labor and Industry said that is has uncovered 'widespread wage theft and unlawful practice' on 19 construction projects throughout Minnesota, including the Viking Lakes mixed-use development in Eagan. As a result of a its investigation, the department said its seeking $2.4-million in back wages and liquidated damages from Property Maintenance & Construction LLC (PMC, also known as Property Maintenance and Construction Inc), and Advantage Construction Inc. (12-19-2023 | Finance & Commerce)

Prudential campus redevelopment clears Met Council hurdle
The Metropolitan Council's Community Development Committee recommended approval of a comprehensive plan amendment for a proposed redevelopment of the former Prudential campus in Plymouth, but the project didn't make the committee's list of sites recommended for environmental cleanup money. The amendment re-guides 75-acres on the site at 13001 County Road 10 from "commercial office" to "mixed use," and accommodates "future redevelopment of the site with a mixture of multifamily housing, retail/commercial uses, and a medical technical business park," according to a committee staff report. (12-19-2023 | Finance & Commerce)

Ex-Viking Tim Baylor buys South Minneapolis Burger King for mixed-use plan
Minneapolis-based JADT Development Group, led by founder and CEO Tim Baylor, plans to develop a mixed-use building at the site of a South Minneapolis Burger King that shuttered during the pandemic. The fast-food joint is now being torn down after the property sold last week for $1.15-million, according to a public real estate filing with the Minnesota Department of Revenue. The public filing notes that the restaurant will be transformed into a new 75-unit apartment building with first-floor commercial space. (12-19-2023 | Minneapolis / St. Paul Business Journal)

Beacon Interfaith project in Maplewood gets funding boost
Beacon Interfaith, a nonprofit affordable housing developer, announced 40 new units will be built in Maplewood after the group secured state funding for the project. The state funding is a part of the historic one-time $1.3-billion investment signed in by Governor Tim Walz in May. More specifically, the $14.8-million awarded to Beacon Interfaith is a part of $250-million designated for financing affordable multi-family housing, according to a press release from Beacon. The 40 homes will be a community called Gladstone Crossing at 1375 Frost Avenue. Half of the home will be designated for people with incomes that are 30% of the area median income, while the other half will be for people with incomes that are 50% AMI. (12-20-2023 | Finance & Commerce)

Luxury housing project in Inver Grove Heights lands $60-million in financing
Trident Development has closed on financing for a 244-unit luxury residential community that it's planning in Inver Grove Heights, near the Eagan border. JLL Capital Markets announced it worked on behalf of St. Cloud-based developer Trident to secure a $45-million construction load from Grand Forks, North Dakota-based Alerus Financial and $15.14-million in mezzanine financing from Minot, North Dakota-based Centerspace for its apartment and townhome project called Avalon Apartments and Townhomes (12-20-2023 | Minneapolis - St. Paul Business Journal)

Minnesota's 2022 work fatalities similar to 2021
The number of fatal work injuries on Minnesota jobsites in 2022 was roughly unchanged from with the previous year, according to a report released by the Minnesota Department of Labor and Industry. DLI, citing information from the U.S. Department of Labor, reported that 81 fatal work-injuries were recorded in Minnesota in 2022, up from 80 in 2021. The state's 2022 fatal-injury rate is 2.8 fatalities per 100,000 full-time-equivalent workers, which is unchanged from the 2021 rate. (12-20-2023 | Finance & Commerce)

New bill would require school districts to follow competitive bidding process
Wisconsin school districts would have to use competitive bidding for construction projects worth $150,000 under a proposal introduced by lawmakers. Assembly Bill 723 would require public school boards to enter the competitive bidding process when constructing new buildings and facilities, according to the bill text. The bill would raise the amount required for local governments to solicit competitive bids for public works projects, instead of awarding them directly, from $25,000 to $50,000. Some highway projects would be excluded. (12-20-2023 | The Daily Reporter)

Wayzata Schools buys Optum subsidiary Solutran's ex-Plymouth headquarters
The Wayzata school district bought the two-story, 32,000-square-foot building, located at 13305 North 12th Avenue for $7.75-million this week, according to a public real estate filing with the Minnesota Department of Revenue. (12-20-2023 | Minneapolis-St. Paul Business Journal)

Biden's Milwaukee visit highlights Black-owned businesses, lead pipe replacement
President Joe Biden toured a Black-owned plumbing company that's replacing lead pipes, a nationwide initiative that's been supported by his administration with billions of dollars, during his visit to the battleground state of Wisconsin. The trip was designed to spotlight a surge in federal government assistance for Black-owned small businesses during Biden's term and to highlight his administration's efforts to ramp up investment in distressed communities. (12-21-2023 | Finance & Commerce)

Enclave pitches 201-unit apartment in Bloomington
If Enclave Cos. has its way, Bloomington will soon be 201 apartments richer, as the developer plans to build on a lot that has been vacant for 17 years. The building, located at 6701 West 78th Street, would be five stories with 201 units. A detached, 11,000-square-foot day care center would also operate on the property, according to city documents. (12-21-2023 | Finance & Commerce)

Minnesota construction jobs up in November
Minnesota's construction industry added 300 jobs in November and has now seen growth in seven of the past eight months, according to data released by the Minnesota Department of Employment and Economic Development (DEED). Overall, the state gained 9,500 jobs from October to November, the fifth straight month of growth, DEED said in a press release, adding that it's the largest increase since January and "well higher than the national rate" of job growth. Also in November, Minnesota's labor force decreased by 7,433 workers for a participation rate of 68.3%. The U.S. rate is 62.8%. (12-21-2023 | Finance & Commerce)

Why Minneapolis' 2040 Plan didn't fix housing's 'missing middle'
Cody Fischer became an infill housing developer in Minneapolis in large part because of the Minneapolis 2040 plan. That comprehensive plan, which went into effect in 2020, is heralded in planning circles as one of the biggest reforms to what's consistently identified as a significant barrier to building more housing in America: the elimination of exclusively single-family zoning. (12-21-2023 | Minneapolis - St. Paul Business Journal)

Down year for multi-family but improvement could be near
When asked how he felt the market for apartments and other multi-family real estate fared in 2023, Northmarq's Ted Bickel had two words to describe it: "Choppy and slow." While there are other factors, interest rates are the first thing he points to when looking for a cultprit for the "choppy and slow" environment. (12-22-2023 | Finance & Commerce)

Wisconsin to spend $414M on wastewater, storm infrastructure
Wisconsin Governor Tony Evers, along with the state's Department of Natural Resources, announced that the Badger State would send $414,4-million to 84 municipalities through its Clean Water Fund program. The funding will help municipalities across the state build needed water infrastructure, according to the release. Projects that reduce phosphorus discharges and address aging equipment are included in the awards, with a focus on small and disadvantaged communities. (12-22-2023 | Construction Dive)

Labor & Workforce

Workplace Law Updates for the New Year

posted on 12.20.2023


Article updated 12-28-2023

A number of important workplace updates have been put in place via the Minnesota Department of Labor and Industry (DLI) over the past few months and quite a few go into effect in the new year. We've gathered them here for commercial constructors to review and take action as needed.

 

EARNED SICK AND SAFE TIME
Minnesota's earned and sick and safe time (ESST) law goes into effect January 1, 2024. The DLI continues to add resources and materials to help employers comply with the new law.

Resources recently added include new ESST FAQs, a recorded webinar presentation, an outreach toolkit for organizations and individuals who would like to help build awareness about the ESST law, and a sample employer notice that must be provided by employers to employees starting by January 1, 2024 when the ESST law goes into effect, and an ESST workplace poster (available in 18 languages).

 

MINIMUM-WAGE RATE
Effective January 1, 2024, Minnesota's minimum-wage rates will increase from $10.59 to $10.85 an hour for large employers and from $8.63 to $8.85 an hour for other state minimum wages.

Learn more about minimum-wage rates.

 

PAY-HISTORY BAN EFFECTIVE JANUARY 1, 2024
Employers in Minnesota may no longer ask a job applicant about their pay history beginning January 1, 2024. This law is being implemented, overseen, and enforced by the Minnesota Department of Human Rights.

 

NEW EMPLOYEE NOTICES
Veterans Benefits and Services

• All employers with more than 50 full-time employees are required to display this poster in a location where employees can easily see it. Required as of January 1, 2024

Earned Sick and Safe Time
• All employers must provide this notice to each of their employees by January 1, 2024 or at the start of employment if employment starts after January 1, 2024. Employers that have an employee handbook must include the notice in the handbook. Required as of January 1, 2024

Nursing Mothers, Lactating Employees. and Pregnancy Accommodations
• All employers must provide this notice to each of their employees at the time of hire and when an employee makes an inquiry about or requests parental leave. Required as of July 1, 2023

Employer-Sponsored Meeting or Communications
• All employers must post notice of employees' rights under this law by August 31, 2023. State law prohibits from taking or threatening to take any adverse employment action against employees who decline to attend employer-sponsored meetings concerning religious or political matters. Last updated August 2023

Minimum Wage Rates
• All employers are required to display this poster in a location where employees can easily see it. Last updated October 2023 

How to get the above mentioned poster notices?
1.)  Download and print the posters individually or in a five-poster PDF file. Posters fit on 8.5" x 11" paper.
2.)  Order posters online.
3.)  Email a request to dli.post@state.mn.us with a business name, contact name, mailing address, phone number and the name and amount of each poster needed.
4.) Order posters by phone at (651) 284-5042. When ordering, include a contact name, mailing address, phone number, and the name and amount of each poster needed. 

 

NOTICE OF CORRECTION TO PREVAILING-WAGE RATES
Affects highway and heavy regions

The commissioner of the Minnesota Department of Labor and Industry certified prevailing-wage rates for highway and heavy construction projects in all 10 Minnesota regions November 20, 2023.

This notice regards a correction to the rates for Region 2 (Job Code Group 306), Region 3 (Job Code Group 304), and Region 7 (Job Code Group 304). This correction is for all public works highway and heavy contracts advertised for bid on or after this date. 

The revised wage rate determinations and all other wage rate determinations are available online.

 

UPDATE ADDED DECEMBER 28, 2023
The Department of Labor and Industry (DLI) commissioner has certified prevailing-wage rates for commercial construction projects in all 87 counties, effective December 26, 2023. 

These rates were identified by annual voluntary survey of commercial construction projects in Minnesota collected by DLI.

See wage-rate determinations on DLI's website here

 

NOTICE OF TRUCK RENTAL RATE CERTIFICATION
The commissioner of the Minnesota DLI has announced a certification of minimum truck rental rates for state-funded construction projects in Minnesota.

The new rates are effective Monday, December 18, 2023. View the minimum truck rental rates here.

 

NEWS RELEASE
DLI seeks $2.4-million in back wages and liquidated damages in enforcement action against construction contractors

Minnesota's DLI has initiated a contested case against Property Maintenance & Construction LLC and Property Maintenance and Construction Inc (PMC) and Advantage Construction Inc (Advantage) by filing a Notice and Order for Hearing at the Office of Administrative Hearings. In the notice, DLI alleges PMC and Advantage failed to pay workers as required by law, resulting in back wages owed in the amount of approximately $1.2-million and an additional equal amount of approximately $1.2-million as liquidated damages.

DLI's investigation of PMG and Advantage uncovered widespread wage theft and related unlawful practices on 19 separate construction projects, including the Viking Lakes project in Eagan, Minn., during its investigative audit period of March 4, 2019, to June 5, 20222. DLI identified 25 employees that it alleges were jointly employed by PMC and Advantage and had not been paid the wages they were due, including overtime wages. DLI's findings include that many employees were paid off the books and in cash for a substantial portion for their employment and were not provided with earning statements as required by law. 

DLI also alleges the violations were willful. As described in the notice, PMC's owner displayed knowledge of overtime laws while flouting them and refusing to pay workers the overtime wages they were owed. Additionally described in the notice, the owner discouraged workers from reporting violations of the law and participating in DLI's investigation. As a result, DLI imposed a civil penalty of $25,000 for these willful violations of the law. Read the full press release here.

Industry Stats & Reports

Hard Hats, Harder Times: Construction’s 2024 Landscape

posted on 12.11.2023

As we wrap up 2023 and peek into 2024, let's have a real talk about the construction landscape. It's been a rollercoaster, hasn't it? With buzzwords like "recession" and "economic downturn" flying around, it's natural to feel uneasy about the future of the industry. But, we're a resilient bunch, and there's a lot we can do to navigate these choppy waters.

First off, the construction sector isn't immune to the hiccups of inflation, labor shortages, and those pesky supply chain disruptions. And yes, the experts are predicting more slowdowns thanks to those supply chain issues, rising costs, and high-interests rates. These challenges are not disappearing overnight, so its' crucial to stay sharp and find ways to keep the projects rolling smoothly.

The big question isn't if contractors will weather the storm, but more how well they do it. Let's dive in:

 

LABOR SHORTAGES
Everyone is feeling the pinch here. Finding and keeping great workers is tough, and the construction industry is feeling the squeeze particularly hard on this one compared to other industries. The demand for skilled hands is sky-high, but there isn't enough skilled workers to go around. Last year's survey from the AGC of American showed 91% of contractors struggled to fill positions. And guess what? In order to keep up with demand, about 546,000 new workers need to be brought on.

 

SUPPLY CHAIN DISTRUPTIONS
Oh, COVID-19, the gift that keeps on giving, right? The supply chain is still trying to bounce back, and the Build America, Buy America Act is adding more pressure with sourcing U.S.-made materials, especially for those businesses working on federally funded projects. We're talking longer wait times for materials to arrive.

 

INFLATION & MATERIAL COSTS
Here's a number for you: construction input prices have jumped 37.7% since 2020. This year's increase is 4.9%, a bit less scary than 2021's 23.1% hike. The price tags on materials are all over the place, with some, like lumber, actually dropping, while others, like concrete and construction equipment, are on the rise. This has made renting equipment more popular than ever.

 

THRIVING DURING UNCERTAIN TIMES
So, how can we keep our heads above water? Adaptation is the name of the game. Many industry vets have weathered economic downturns like this before, and there's wisdom in that experience. Look for cost-cutting strategies, protect your assets, keep informed, and stay optimistic.

 

STAY ON TOP OF TRENDS
Knowledge is power, folks. Keeping up with industry trends and news helps contractors prepare and tweak their strategies. Think articles, reports, newsletters --- all that good stuff to keep your business in the loop (and MBEX is a great go-to source for all of the above).

Another great place to gain insights into the 2024 construction season, tune in to Construction Executive's 2024 Construction Economic Update and Forecast on Wednesday, December 13 at 1:00pm CST. Led by Anirban Basu (chief economist for Associated Builders and Contractors) and crafted with commercial constructors in mind, he will offer insights on challenges facing the industry, sharing data and insights on labor expenses, materials pricing, market-sector growth and construction spending, as well as the latest on inflation and if, and/or when we'll actually see a recession. Register for this one-hour, free webinar here.

 

PLAN FOR THE UNEXPECTED
Expect hiccups with supply chains. Here are a few pro tips:

• Order early to avoid delays.
• Have a backup plan for material shortages/delays to keep projects on schedule.
• Look for alternative suppliers and subcontractors, as well as better rates.
• Use security measures like cameras to protect your materials.

 

FOCUS ON YOUR TEAM
A project is only as good as one's team. Investing your workforce is key; here's a few ideas on how to support them:

Competitive Pay: It's not just about the paycheck; it's a sign of your company's value. The best talents expect the best compensation. 
Embrace diversity: Diversity isn't just good for ethics; it's good business. More diverse companies tend to be more profitable.
New Recruitment Avenues: Hit up job fairs and trade shows to find fresh talent, with both inexperienced and well-versed backgrounds.
Supportive Culture: A great work environment keeps great workers. Think safety, fun, and growth opportunities.

 

LOSS PREVENTION
With high material costs, safeguarding your assets is crucial. Security cameras and professional monitoring not only deter theft but might also snag your business an insurance discount. Protecting your assets is key to maintaining profitability.

 

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No one is denying we're in a tough spot right now, but this industry is resilient (remember how we powered through the thick of COVID-19?). By facing these hurdles head-on, staying united, and being smart about costs, our industry is poised to emerge stronger than ever.

Roll up those sleeves, finish 2023 strong, and let's show 2024 what we're made of.

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