Another tech business spurns St. Paul for Minneapolis

It's really no surprise that the high-profile technology firm When I Work Inc. recently decided to leave St. Paul for Minneapolis.

When I Work is growing about as fast as its recruiters can hire. To be nestled between transit stops in the lively area around Target Field should be a powerful advantage in the toughest competition this company probably faces.

This would be news to shrug off in St. Paul, if only there weren't other examples that suggest St. Paul is losing economic steam.

Cray Inc.'s St. Paul operation will soon be off to a new building adjacent to the Mall of America. When Cray announced it was moving to St. Paul with 225 or so jobs in 2009, and with a $400,000 forgivable taxpayer loan, a news account noted it had signed a 10 ½-year lease. It didn't even last eight.

Even the best news of the recent past, the decision by the city's marquee company, Ecolab, to commit to a new headquarters in St. Paul, only meant taking over the building of a company that looks to be on its way out of town.

Paul DeBettignies, a Minneapolis-based recruiter for technology jobs, said that if he were a public official in St. Paul, "I'd be concerned, too."

Concern, maybe yes. Panic? Too soon.

Anybody looking to build a technology workforce in St. Paul needs to acknowledge that the North Loop of Minneapolis has become the cool place to be. Technology firms wanting to be around each other there reminds DeBettignies of the time in the 1990s when technology firms preferred to be just off the freeways in the southwest suburbs.

The thinking hasn't changed, either. It's putting the office where it's easy to get to from where tech workers live. It's also fun to go every day to a community where like-minded people work. Plus, if one job doesn't turn out to be a good fit, there might be openings at other companies a short distance away.

How well St. Paul can compete for these companies is in the eye of the beholder. One asset St. Paul has is a collection of amenities similar to what draws workers to the North Loop, particularly in the Lowertown district, with bars and restaurants, accessible transit and even a lovely minor league ballpark.

DeBettignies said he also routinely reminds clients that "it's just false" that there are no software developers who live east of Interstate Highway 35E.

With the center of gravity for technology staying put in Minneapolis, though, getting an established firm to move to St. Paul seems unlikely. That doesn't mean that the companies can't get their start in St. Paul and then mature there.

One problem is that much of the available office space in downtown, while there is a lot of it, doesn't work great for young technology companies.

The office vacancy rate in downtown St. Paul actually has declined recently, according to the real estate firm Colliers International, but mostly because two more office buildings just dropped out of the office inventory to get converted into apartments.

So-called C buildings like these may have had slow elevators, small windows and columns cutting up the space, but they could provide cool workspaces if all the interior walls were ripped out. And they had the great virtue of being cheap.

Another problem business people in St. Paul complain about is that down at City Hall they care a lot about jobs — the mayor just announced a goal of creating 3,000 new ones over three years — but they sure don't seem to care much for the businesses that create them.

While this is a perennial complaint in the central cities, it isn't easy to spot the voice for business on St. Paul's City Council. In searching council member bios for any private-sector work experience at all, even something like staffing the counter at a Dairy Queen, it took some close reading to find that Council Member Amy Brendmoen had once worked for an ad agency.

The council includes a retired policeman, an assistant county attorney, a nonprofit IT manager, a transit advocate, a law school alumni coordinator and someone with a bio that simply begins with "community builder."

If by community building the city means savvy investments in transit and other infrastructure and supporting the kind of amenities that help employers attract workers, then community building can be a way to build the economy. Right now Lowertown workers can make the quick walk to CHS Field after work for a baseball game, and it won't be long before it's possible to hop on the Green Line to get to a Major League Soccer match in the city, too.

Helping get these things built was a big part of the city's strategy for job creation, said Jonathan Sage-Martinson, who heads planning and economic development for the city. Sage-Martinson said among the initiatives the city is working on now is exploring a strategy to develop more collaborative work spaces for start-up companies, maybe using the incubator model, with partners including the St. Paul Area Chamber of Commerce.

The partners are still talking concepts and not details, but one thing was perfectly clear in a conversation last week with Chamber President and CEO Matt Kramer. That's that he sure doesn't see any reason to panic over one or two technology companies not quite finding the right office space in St. Paul.

It's probably true that chambers of commerce rarely hire pessimists, but the message he delivered was that the thinking at the St. Paul chamber hasn't fundamentally changed in perhaps 150 years. Business growth for the whole region is good, public officials need to be reminded to do more to help and St. Paul has keep battling to make sure it gets its fair share.

"We're just never going to give up on this," he said. "This is a really cool, vibrant downtown. It's the heart of our state. And we're going to make it."

lee.schafer@startribune.com • 612-673-4302