Rice Companies planning large project near Walmart distribution center

Apr. 10—MANKATO — Rice Companies design and building firm is planning a $6 million facility in Eastwood Industrial Park, across from the Walmart distribution center.

The 50,000-square-foot building will house businesses such as contractors, warehousing, and small manufacturers.

The building will include truck-loading docks and space outside for vehicles, including heavy equipment.

Rice Companies will be one tenant in the building with seven full-time equivalent employees with plans to grow to 15 employees in the next five years.

Marius Rygg, president of the Mankato and Fargo Rice offices, said they are "looking forward to getting brick and mortar in the community. We're actively looking to grow our company."

Another unnamed tenant would have 11 full-time employees with average hourly wages of $29 plus benefits. The tenant plans to add qualified employees if they can find them and is partnering with South Central College to identify potential employees.

Another tenant has six full-time equivalent employees with average hourly wages of $27 plus benefits. They may add another six employees.

Rygg said their office and the other two tenants will take up just over half of the building.

Rice Companies will purchase nearly 12 acres of land from the city of Mankato. The proposed purchase price is $522,600, which is $65,000 per acre for about 8 acres of usable land. The remaining three acres of the property are not buildable as they have a gas-line easement.

After certain costs, the final net proceeds to the city will be $459,849.

Once complete, the estimated city property tax collection from Rice Companies will be $42,500 annually.

Based in Sauk Rapids, Rice Companies has offices in Mankato, Fargo and Glencoe. The Mankato office was created in 2018 when Rice acquired Gosewisch Construction. Their Mankato office is now at 901 Summit Ave.

They are a full-service design/build firm that does everything from remodels and new construction to facility maintenance and leasing space to businesses.

The project is on part of 70 acres the city purchased in 2008 from James and Betty Sohler to expand the light industrial park.

The land was purchased for $21,000 per acre and additional city investment was made to install infrastructure — Power Drive and Energy Drive and associated water and sanitary sewer services.

Mankato Community Development Director Paul Vogel said the proposal is now before the city's Economic Development Authority for approval. He said closing on the property is slated for June.

Vogel said the city is not looking at buying more property in the area for industrial use. Since 2018 the city has shifted away from the traditional model of buying land to attract development.

"We really focus on the installation of infrastructure and partnerships with private property owners. That's not to say the city won't in the future invest in industrial properties."

Vogel said the strategy of allowing private land owners to work with prospective industrial users and having the city work with them to install infrastructure has worked well.

He pointed to the Walmart distribution center. For that project the company bought the land from the Sohlers and the city worked with it to get the roads, sewer and other infrastructure in place.