St. Anthony: Downtown Minneapolis added jobs and residents in 2012

The downtown Minneapolis economic engine, other than sputtering department store retailing, steamed ahead again in 2012 and even topped some prerecession ­benchmarks.

Crime is down, thanks to collaborative and innovative partnerships among business, police and social ­service agencies. Businesses are expanding, dining-and-entertainment venues are drawing more patrons and the downtown residential population and employment are surging, according to 2012 statistics submitted from industry groups for last week's annual meeting of the Downtown Council.

A variety of stakeholder groups have rallied behind the council's "2025 Plan," whose top priorities include the end of street homelessness, business and residential expansion, increased transit options and less car congestion.

"With the 2025 Plan now in motion and support by all key stakeholders, not just business folks, we are poised to leverage a fast start on implementation … and blow the lid off this thing," said Collin Barr, a Ryan Companies executive who is the council's incoming chairman. "Employment is up. Business is expanding.''

Significant developments include:

• Downtown total employment is approaching an estimated 160,000, including scores of small businesses. The 15 largest employers hired a net 750 more people last year. Total employment rose to 50,240, up 8,000 jobs from 2010. Target alone, has added nearly 2,500 people to its downtown campus since 2010 for a total of 12,239. The next largest employers are Wells Fargo (7,000), Hennepin County Medical Center (5,800) and Ameriprise Financial (5,650), which has added 650 jobs over the last three years.

• Downtown's residential population rose 7 percent to 36,500 in 2012 and should double to 70,000 by 2025. Commensurately, 2,314 new housing units were approved for construction, feeding the new construction boom in the Warehouse District and along the Mississippi River, as well as renovation of the Soo Line Building into apartments.

Nearly 500 downtown ­condominiums sold for an average price of $288,280, up 4 percent from 2011.

• About 400,000 square feet of office space was absorbed by new and expanding tenants, an amount equivalent to three Target stores. And the vacancy rate for Class A space, or the most modern, dropped below 10 percent for the first time in five years. Meanwhile, Xcel Energy is adding a nine-story office building across the Nicollet Mall from its headquarters; a new Lunds supermarket and several adjacent shops opened at the once-frayed south end of Hennepin Avenue; Orchestra Hall and several other big commercial places, including 701 Washington Av. N., are being renovated.

• A contractor is about to be selected for the $950 million Vikings stadium complex, which may spur incremental development on the east end of downtown. And a $100 million overhaul of 22-year-old Target Center is expected to start in 2013.

"Things are looking good," said Russ Nelson, a veteran downtown commercial real estate executive.

The Downtown Improvement District, a business-funded creation of the council, and its ubiquitous green-jacketed ambassadors, assisted more than 100,000 pedestrians, collected 1 million pounds of trash and recyclables from the streets, and planted 15,275 trees, bushes and other plants.

• Neiman Marcus closed its downtown store, amid a consensus that downtown retail no longer will be anchored by several big department stores. That followed the downsizing of Saks Fifth Avenue.

Mark Stenglein, a former Hennepin County commissioner who replaced longtime CEO Sam Grabarski at the council last year, said downtown residents and workers who patronize midprice Target and Macy's also seem to be voting in favor of grocers, such as Lunds, as well as specialty retailers and ethnic restaurants. Stenglein noted that venerable Hubert White, the men's clothier, is expanding and renovating in the IDS Center. Niche retailers such as LD Blues, Martin Patrick 3, Len Druskin and Allen Edmonds report brisk business.

In an interview, Stenglein said the council's No. 1 priority this year, following completion of last year's Vikings deal at the Legislature, is to obtain $25 million toward renovation of the Nicollet Mall. The council is joining the city in that effort. The state funds would be matched by more than $25 million in local funds.

Neal St. Anthony • 612-673-7144 • nstanthony@startribune.com