A homegrown company with 150 full-time employees is facing a funding gap as it looks to expand and consolidate its facilities, but at a Wednesday night meeting, the City Council expressed a willingness to help ensure it remains a Faribault staple.
Founded in 1992 by Rick Dahl, Trystar manufactures temporary electrical power units for commercial and emergency services purposes. Its products are particularly in demand when natural disasters like floods, fires, hurricanes or tornadoes hit. The company has enjoyed rapid growth over the last decade, winning over devoted customers from all over the world. Last year, Dahl sold the company to a Twin Cities-based equity firm.
Trystar has had its main facilities here in Faribault for more than two decades, although the company has considered moving before. In 2012, the company announced plans to construct a 170,000-square foot facility in Shakopee, but those were eventually scrapped.
Trystar’s employee base, which often expands to 200 with the addition of part-time workers during peak times, is composed of a mixture of local residents and commuters from the Twin Cities, according to CEO AJ Smith. Smith was hired to run Trystar last year by its new owners, after a decade as an executive at Honeywell International. After such a long time at a large company, Smith said he wanted to take a unique but informed approach at the much smaller Trystar.
One of Smith’s first moves as CEO was to open a new office in Burnsville. Smith said that the new location has proven to be a recruiting tool for Twin Cities-based workers, and is convenient for customers thanks to its proximity to the Minneapolis-St. Paul International Airport.
Still, Smith insisted that the company wants to remain in Faribault. However, he added that in order for the company to expand in Faribault on a financially competitive footing, aid from the city would be needed.
As the business has grown, Trystar has managed to increase its space by working with local construction firm Met-Con. However, the company’s current 140,000 square feet of space are inconveniently spread out across four buildings. Although those buildings are located near each other in north Faribault’s industrial park, Smith said that the company could significantly improve its efficiency and growth under one roof.
Initially, Trystar and Met-Con explored the option of expanding one of the company’s existing Faribault locations. However, they discovered that under the current building code, none of those sites could be expanded sufficiently to meet the company’s needs. TryStar then expanded its search to include potential sites in Burnsville and Lakeville. There, the company found several sites that it said could accommodate current needs and future growth for an affordable price.
Still, Smith said that he has great respect for the relationships that the formerly family owned company has built in Faribault. In addition, some of its workforce commutes from Owatanna and other places to the south, and would be inconvenienced by a move to the Twin Cities.
As an effort to stay in town, Trystar inquired about a 100,000-square foot warehouse recently constructed by Met-Con. It was built for the Cheese Cave, Faribault Foods and SageGlass, but those companies expressed interest in moving into the facilities Trystar would vacate instead.
While this option could meet the needs of all companies, it would be about $550,000 more for TryStar than comparable options in the south metro. About $400,000 of this would be due to higher rent over a period of time, and $150,000 to accommodate needed building modifications.
“This is about more than the financial considerations for us,” Smith said. “But at the same time, I need to be able to go to our board and say this makes financial sense.”
Because the project wouldn’t be tied to a new company or new jobs, it won’t be easy to get funding from it from traditional economic development agencies. That said, the city could put together a tax increment financing package to help Trystar.
For the Economic Development Authority, keeping Trystar in town is a high priority. According to a memo from Community and Economic Development Director Deanna Kuennen, 80% of a city’s new jobs and investment traditionally come from existing firms.
City Councilors voiced strong support for providing funding to keep Trystar in Faribault. Mayor Kevin Voracek said he was particularly pleased to see area business working together to potentially achieve an amenable solution for all.
“It makes sense,” he said. “We get to help you out and then we can work with some of the other businesses in town, see if we can match some of their needs better.”
Councilor Tom Spooner agreed, arguing that keeping Trystar’s 150 to 200 jobs in town in exchange for some tax increment financing constitutes a bargain.
“If we tried to attract a new company to Faribault, it would probably cost 10 times this amount,” said Spooner. “The amount that we’re going to put into tax abatement to retain this company here seems to be a no-brainer for me.”