MN Valley Business by Free Press Media

The Definitive Business Journal for the Greater Minnesota River Valley March 2021

Rich Weyhe, left, and and Tim Paulsen of R Henry Construction. Photo by Pat Chritman

Pandemic projects Remodeling has skyrocketed Also in this issue • MENARI BODY WORKS • NORTHSIDE HAIR CO. • RENAISSANCE GLASS

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F E A T U R E S March 2021 • Volume 13, Issue 6

Area residents who spent more time in their homes during the pandemic chose to do remodeling projects, keeping contractors busy.

Olivia Hageman and her staff meld physical and mental well being at their Menari Body Works on Belgrade Avenue in North Mankato.

Jennifer and Richmond Clark bring hairstyling options for an increasingly diverse clientele at their Northside Hair Co. in North Mankato.

For decades Larry Hodgson made and sold his blown glass creations at festivals and seasonal shops, now he’s opened Renaissance Glass.

MN Valley Business • MARCH 2021 • 3

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MARCH 2021 • VOLUME 13, ISSUE 6

By Joe Spear

PUBLISHER Steve Jameson EXECUTIVE EDITOR Joe Spear ASSOCIATE EDITOR Tim Krohn CONTRIBUTING Tim Krohn WRITERS Kent Thiesse Dan Greenwood Katie Roiger Dean Swanson PHOTOGRAPHERS Pat Christman COVER PHOTO Pat Christman PAGE DESIGNER Christina Sankey ADVERTISING Danny Creel Sales Jordan Greer-Friesz Josh Zimmerman Theresa Haefner Tim Keech ADVERTISING Barb Wass ASSISTANT ADVERTISING Christina Sankey DESIGNERS CIRCULATION Justin Niles DIRECTOR For editorial inquiries, call Tim Krohn at 507-344-6383. For advertising, call 344-6364, or e-mail advertising@mankatofreepress.com. MN Valley Business is published by The Free Press Media monthly at 418 South 2nd Street Mankato MN 56001.

■ Local Business memos/ Company news....................................5 ■ MRCI....................................................6 ■ Business Commentary........................7 ■ Business and Industry trends .........20 ■ Retail trends ....................................21 ■ Agriculture Outlook .........................22 ■ Agribusiness trends.........................23 ■ Construction, real estate trends ....24 ■ Gas trends .......................................25 ■ Stocks ..............................................25 ■ Minnesota Business updates...........26 ■ Job trends ........................................27 ■ Schmidt Foundation ........................28 ■ Greater Mankato Growth .................30 ■ Greater Mankato Growth Member Activities ...........................31

From the editor

When Marxists meet market GameStoppers

ittle known, smallcollege professor John Munkirs once posited the American economy was not that much different than the centrally planned economy of Russia.

In fact, the Sangamon State University economics professor laid out an elaborate plan showing how the private sector, through coordination of debt, boards of directors and market concentrations, controlled the American economy and who benefitted. It was reminiscent, Munkirs said, of how they did business in the Union of the Soviet Socialist Republic. Of course, Munkirs wrote his book back in 1987 and it was required reading from my Minnesota State University professors who weren’t afraid to push the envelope of conventional economics. That was good for me, because as a liberal arts major, I struggled with supply and demand curves, production functions, regression equations and the concept of marginal utility that was the crux of conventional economics. But Munkirs’ underlying theory, if not the underlying evidence, still exists today, except now in the form of hedge funds, that can best be described as complex financial instruments that are so complex even regulators don’t understand them. The funds aggregate securities and debt instruments and “hedge” shares that are designed to take all risk out of trading, or at the very least, make their investors think so. But the hedge funds recently had a rude awakening from that concept when they met the

4 • MARCH 2021 • MN Valley Business

loosely colluding internet traders in GameStop stock. It was like Politburo meeting the proletariat. The hedge funds had sold short the stock in GameStop, AMC movie theaters and other enter tainment companies figuring there was no way these companies could continue with pandemic restrictions on movement and interaction. GameStop was competing with the movement of gaming to online sites versus physical games inserted into gamer devices. But the collectivizing power of the internet proved them wrong. The fans of GameStop, presumably gamers themselves, took to a band leader by the name of “Roaring Kitty,” who worked as a financial advisor. He led the charge for small investors, some buying only one share, with his urging through internet sites like YouTube. This was about much more than day trading. These small investors had a cause when they knew they might be able to take down billion-dollar hedge funds who were kicking sand in the face of GameStop and its faithful followers. Some were disciples of the now defunct “Occupy Wall Street” movement. They would pledge to Kitty: “If he’s still in, I’m in,” and they roared GameStop stock to a high of $483 a share, compared to its earlier price of around $17. When hedge funds had to sell their short positions facing a deadline, they lost billions of dollars. According to the Associated Press hedge funds Citron Research, Melvin Capital and others lost an estimated $5 billion betting on GameStop to fall. The researchers at big firms

were now writing in their newsletters that “populism traders” will be here to stay and will likely strike again, and they will be a new reality of the investing world. “We do see that the little guy is flexing their muscles,” said Pauline Bell, analyst at CFRA Research. “Retail investors now have tools to band together and move the markets.” Roaring Kitty, who is Keith Gill of Boston in real life, likely pocketed millions as he sold, some say before his friends could also do so, as GameStop came back to reality. And Gill is getting scrutiny from regulatory authorities as someone who is not licensed to give investment advice. His hometown newspaper in Massachusetts is calling him the “Brockton Legend,” and hoping he will donate money to build a new high school track. Hollywood is considering a movie. It’s a delightful conflict worthy of a John Grisham (The Firm) financial crimes novel. The clashing of cultures and power might also spur another fantastic financial crime move like “The Big Short.” Munkirs thesis drew attention to the idea that the “free market” wasn’t really free, but rather controlled by powerful interests who mostly acted for their own good to have high profits in a world with little competition. But we might just have the GameStoppers as our last line of defense. Joe Spear is executive editor of Minnesota Valley Business. Contact him at jspear@mankatofreepress.com or 344-6382. Follow on Twitter @jfspear.

Read us online!

Local Business People/Company News ■

Anderson joins Blethen Berens

Macy Anderson has joined Blethen Berens, practicing in the areas of estate planning and business formation. She grew up in Eagle Lake. Prior to coming to Blethen Berens, Anderson worked in corporate compliance and healthcare administration and has been involved with a variety of organizations. ■■■

ResCom merges with True

ResCom Realty in Lake Crystal has joined True Real Estate, adding Deb Richmond-Johnson, Jackie Graham and Krista Lunz as real estate agents at True. True’s Lake Crystal office is at 130 Main Street in the former ResCom Realty office. ResCom Realty opened in 1981. Richmond-Johnson, former broker/owner of ResCom, has been in real estate for 30 years and is a native of Lake Crystal. ■■■

Weichert execs honored

Jim Weichert, James Weichert Jr. and Bill Scavone have been selected for the 2021 Swanepoel POWER 200: The Most Powerful People in the Residential Real Estate Brokerage Industr y, ranked #27 and #109, respectively. They were chosen based on the office they hold, their tenure, the size of the company they lead, its financial resources, their significance and impact on the industr y, their company’s activities in the previous year, other activities outside their own company and their personal power and influence. Jim Weichert, founder of Weichert Cos., along with his son and vice chairman, James Weichert Jr., shared the #27 spot on the list for the second consecutive year. Scavone, the president and COO of Weichert Real Estate Affiliates, ranked #109

as he made his fourth straight appearance on the list. ■■■

Gislason names partners

Gislason & Hunter named four attorneys — Chris Bowler, Rick Halbur, Brittany King-Asamoa, and Dean Zimmerli — as partners. Bowler provides both litigation and transactional ser vices to individuals and businesses, primarily those engaged in the fields of banking, finance, agriculture or agribusiness. Halbur focuses his practice on banking and finance, bankruptcy, commercial litigation and agriculture. ■■■

Magers promoted

Shannon Magers has been promoted to market manager of Alpha Media’s four-station cluster (KEEZ, KYSM, KRBI, and KMKO) in Mankato. She started at Alpha Media in 2012 where she has been the business manager for the Redwood Falls and Mankato clusters. ■■■

Woodside Apartments sold for $55M

Edgewood REIT has purchased Woodside Apartments in Mankato for $55 million. Woodside is a class A multifamily development consisting of eight buildings and 440 apartments at 311 E Roosevelt Circle Mankato. Founded in 2010, Edgewood REIT is a North Dakota-based real estate investment trust whose primary investment objective is to acquire health-care properties, medical office buildings and multi-family assets.

MN Valley Business • MARCH 2021 • 5

MRCI Success Story When Jon Jamieson moved and expanded his personal training studio, JP Fitness, in August 2020, he faced a unique challenge: he was doing it in the middle of a pandemic. He and his trainers kept the old studio clean, but he knew in his bigger space and with enhanced needs for cleanliness, he would have to bring in help. He wasn’t sure where to look, then he found a valuable resource in MRCI, a nonprofit that serves individuals with disabilities. “I didn’t really know much about MRCI until a member suggested I contact them,” says Jamieson. “It has been a great fit so far. MRCI makes sure Christina is trained properly for my specific needs, and then they continue on with support when she needs it. It’s been a joy having Christina around and members enjoy her too.” Christina is a true MRCI success story. Like so many others, when COVID hit, she lost her job. With the help of MRCI, she was able to find a job and succeed on her own: JP Fitness was her first competitive job without an MRCI staff on site. “She has been doing great – we’ve had to make some small adjustments – but she is so thankful to us for helping her find JP Fitness. Jon and his staff at JP have been so great to her,” says Dani Genelin, MRCI Employment Manager. Christina came to MRCI out of high school in 1998. She started in the MRCI production area packaging various products then moved onto the MRCI Thrift Store in 2005. She worked at the Thrift Store for 15 years but it ended due to Covid. Christina though, persevered to find another job she loves. “I am so proud of my job at JP Fitness,” says Christina. “I really like cleaning at JP Fitness because the people are so nice, easy going and so wonderful to work with. I like that all the other employees make me feel a part of their team.” Person-centered, focused on the success of the individual…that’s how MRCI fulfills its mission of providing innovative and genuine opportunities for individuals with disabilities at home, at work and in the future. To learn more about the workforce solutions at MRCI, call 507-386-5600.

About MRCI

MRCI provides genuine opportunities for people with disabilities and disadvantages at home, at work and in the community. Please help us with that mission by volunteering of your time and talents! Please call 507-386-5600 to make a difference today!

6 • MARCH 2021 • MN Valley Business

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Business Commentary

By Dean Swanson

Using social media or ecommerce sites to sell online

f you decide to sell online, let us consider two other options that are included in one of SCORE’s projects that was developed with the help of and in partnership with FedEx. This project is called “Startup Roadmap” and outlines every step in starting a business. I suggest that you ask your mentor about this great resource.

Social Media Selling

The biggest benefit of selling on an e-commerce website is that you own the site.

Ecommerce Website

your website–even if it happens at 3 a.m. on Black Friday. The simplest way to set up an ecommerce website is by using an ecommerce website builder. (Your mentor can help you find some of these). Also called ecommerce platforms or shopping carts, these companies provide everything you need to build and run an ecommerce website, from site design templates to payment processing and order management tools. When choosing the right ecommerce website builder technology, start by determining your needs; then ask yourself these questions about the solution you’re considering. These will help you define what you need but also provide guidance as you consider several website builders and compare their costs. n How many products do you plan to sell? n How much detail do you need to include in product descriptions? n How easy is it to add products to your inventory or make changes to your listings? n How customizable do you need your website to be? n What marketing and sales tools are offered? n What security features are offered? n How scalable is it? n Does it include social selling or online marketplace integration? n What payment options does it offer? n Which inventory management, shipping and fulfilment applications does it integrate with? n How robust is customer support? n What is the total cost?

Just about every startup business will use social media as a marketing tool. When your social media followers see the products you sell, making it as convenient as possible to buy them can help you make the sale. Social media selling is constantly changing. In general, most social networks are making it easier to sell from within their apps. While this is ever-changing, here’s a look at a few channels to consider: Facebook: If you have a Facebook Business page, you can set up a Facebook Shop where customers can buy from you directly on Facebook. However, you can also sell on Facebook Marketplace—an online marketplace where both individuals and businesses sell products—if you work with an approved network of e-commerce website partners. Instagram: “Shopping on Instagram” lets you feature products using product tags or stickers. Users who tap on the tags or stickers go to a product page, where they see more information about the product and a link to your website, where they can buy it. Pinterest: This social network is very shoppingoriented; users are often looking specifically for things to buy. Users can click on Pinterest Shopping Ads to go to your website, where they can buy your products. As you can see, most social media sites still require users to ultimately go to your website to make a purchase. As a result, selling on social media is usually better as an add-on to your existing ecommerce strategy, not your entire strategy. Look for an ecommerce website builder that makes it easy to post and sell products on social media, and you’ll have the best of both worlds. The biggest benefit of selling on an e-commerce website is that you own the site. You control what happens on the site, what it looks like, what it says and what your customers can do there. There is no competition from other businesses or products to distract visitors from yours. The look and feel of the site promotes your brand, not the brand of another company. However, a startup ecommerce website will have to do a lot of marketing to attract visitors, unlike a marketplace such as Jet that has millions of built-in visitors per day. You’ll also be responsible if something goes wrong with

Most ecommerce website platforms offer free trials. Take advantage of these to play around with the platform for a week or so and see how well it suits your needs.

Dean L. Swanson is a volunteer certified SCORE mentor and former SCORE chapter chair, district director, and regional vice president for the north west region. For information on the local Mankato area SCORE chapter: scmnscore.org MN Valley Business • MARCH 2021 • 7

From left, project manager Kriss Hyland, Rich Weyhe and Tim Paulsen of R Henry Construction at a remodeling project they handled.

Remodeling boom Higher prices, some shortages persist By Tim Krohn | Photos by Pat Christman

heltering at home brought booming business for home improvement stores and contractors as people spent more time in their houses and eyed things they’d like to upgrade. “With more people working from home they’re looking for flexible space, whether it’s for kids doing school work or people working at home or

being outdoors in the summer,” said Kevin Simmons, who with his brother-in-law Eric Van Eps own Mankato Family Homes. Rich Weyhe, president of R Henry Construction, said they’ve been booked with remodeling jobs since last spring and things haven’t let up. Many projects, he said, are people

Cover Story

8 • MARCH 2021 • MN Valley Business

Jason Phillips, owner of Phillips Built, has been busy with kitchen remodels like this one as well as other projects for homeowners. upgrading their home rather than looking to buy a different house or build new. “A lot of people like the lot they’re on and the cost of new construction isn’t cheap, so they figure they like where they are and they’ll do the work,” Weyhe said. Jason Phillips, owner of Phillips Built and a director on the Minnesota River Builders Association, said the demand for work has been great for his newer business, which he started four years ago. “It’s been kind of a break-out year for us. It’s been just crazy. We’re telling people we’re booking remodels for 2022 now.” According to various surveys, more than three-quarters of all American homeowners said they had done some type of home improvement project during the pandemic and more than three-quarters also said they plan to take on a new project in 2021.

R Henry Construction has been doing a lot of additions, including sun rooms and screen porches.

Many going big

While many people took the opportunity of more home time to do DIY jobs, such as painting or laying some new laminate

flooring, many hired contractors to do more major work. “The remodels aren’t just a bathroom here or bathroom there. People are doing major remodels,” Phillips said.

MN Valley Business • MARCH 2021 • 9

DREAMING

DOING

YOU KNOW WHAT YOUR GOALS ARE. WE’RE HERE TO MAKE THEM HAPPEN.

Mankato Family Homes says bath and kitchen remodels remain high on homeowners’ wish lists.

507.387.6031 | eidebailly.com

“They’re looking at how their home works or doesn’t work for them. The dining room table is now the classroom and the spare bedroom is an office,” Phillips said. We are getting a lot of demand for remodeling,” Weyhe said. “Quite a bit more this time of year than normal.” He said R Henry has staff who develop remodeling plans, which has added to their business. “There seems to be a little drafting shortage in town so people are calling because we have in-house drafting services.” The list of projects covers most ever ything inside and outside of homes. “People are adding additions to their house,” Weyhe said. “Some people are even taking the roof off and doing a second story. They’re adding on to their garage, finishing the basement, kitchen and bathroom remodels, you name it.” Simmons said remodeling goals remain much the same as in the past, there are just more of them.

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“The No. 1 thing we’re doing is remodeling the kitchen or main living area where people are spending a majority of their time. They want to open it up, put in new flooring.” Simmons and Weyhe said top on the wish lists for kitchens are bigger islands, more windows, fewer upper cabinets and more open shelving, gray and white colors, quartzite counters, seating and prep areas. “Also upgrading the lighting is a big thing,” Simmons said. “Rather than one central light there’s a lot of recessed lighting throughout the room.” He said they’re also doing a lot of bathroom remodels and adding a second or third bathroom to homes. Weyhe said people are also remodeling or adding on to better enjoy their yards. “We’re doing a lot of four-season porches and screen porches are popular. They keep the bugs out. We did some bigger-size decks.”

Shortages, higher costs As

remodel

and

addition

Eric Van Eps, left, and Kevin Simmons of Mankato Family Homes at a kitchen remodeling project. projects soared, material shortages increased, driven by higher demand and because manufacturers had employees out because of COVID-19. “There’s been some shortages on sheet goods and things,” Weyhe said. “But the main thing is just the prices are high. Lumber prices usually come down in the winter but they haven’t.” Phillips said material costs are at record highs. “There’s no sugar-coating it, it’s expensive to build new or remodel. But low

interest rates have really helped.” Simmons said material costs won’t be going down. “At a certain point this summer material costs were extremely high. But the bigger problem has just been getting materials. There are more problems with shipping and shipping times are longer.” He said shipping issues have improved some this winter. “We’re still able to get materials but in some cases we might have to wait longer. There is

greater accuracy now in knowing when it’s coming, at least.” Contractors say customers usually aren’t aware of the true costs of a project when they are getting bids on them. “Most people underestimate what it will cost for new construction or remodeling,” Simmons said. “It’s hard for people to keep up with the cost increases. But the historically low interest rates help offset the costs some.” MV

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MN Valley Business • MARCH 2021 • 11

Top from left, Rachel Nelson, Ingralisa Anderson, Olivia Hageman and Darcey Nelson of Menari Body Works. Bottom: The sauna at Menari Body Works.

Passion for wellness

Menari offers emotional, physical well being By Katie Roiger Photos by Pat Christman

times, we have to show them how to get livia Hageman is the name and there.” thriving is the game! Whether it’s Hageman’s journey to becoming a helping her clients toward physical cer tified massage healing or pursuing her therapist was a roundown passion for the-world expedition. wellness, Hageman When she was nine takes pride in being years old her family true to herself by MENARI BODY moved from the United helping others flourish. WORKS “I really believe very States to the Indonesian 227 Belgrade Ave., strongly that we don’t island of Java. Living North Mankato heal people: People heal abr oad piqued themselves,” said Hageman’s interest in Menaribodyworks.com Hageman. “But a lot of other cultures and also 507-388-8315

Spotlight

12 • MARCH 2021 • MN Valley Business

introduced her to the fascinating world of massage therapy. “My mother loved going to all the luxurious day spas and would take me with her,” said Hageman. “I was so lucky at a young age to receive many different styles of massage, body scrubs, and whatever else interested me. It opened my horizons by showing me that you can thrive anywhere you are, and the importance of having an open mind and trying new things.” Although Hageman’s early years gave her an appreciation of diverse cultures, they didn’t immediately propel her toward a vocation in massage therapy. After receiving her degree in Visual Arts from the University of Sydney in Australia, Hageman moved to California to concentrate on launching an artistic career. She supported herself by working as a bartender while building her portfolio and landing art showings. Enjoyment of her work and excitement for the future buoyed her hopes until the economy plummeted in the early 2000s. “Being an artist is a hard life,” said Hageman. “I couldn’t see myself making a living with it.” At the same time, Hageman was becoming disillusioned with her bartending position. Her health was starting to suffer from the long, demanding hours, and the work wasn’t what she had envisioned for her life. Hageman’s breakthrough came in the person of one of her cocktail waitresses, who was going to school for massage therapy. She shared information about her studies with Hageman, who found herself looking forward to hearing more each shift. “You know when you’re a little kid, your parents ask you, ‘What do you want to be when you grow up’?” Hageman said. “I always said I wanted to be a doctor. I love the human body, but I don’t like blood, which is why I didn’t pursue it. But (massage therapy) was a chance for me to learn more about the body.” Hageman decided to talk with her colleague’s teacher to learn more about becoming a masseuse. Everything she heard made her feel as though she had finally

found her calling. She enrolled in massage school, transitioned out of bartending two years later, and worked at a 5-star Californian day spa for several years before moving back to Minnesota.

Several massage styles

Over the course of her career, Hageman has become certified in a plethora of massage styles, from Swedish, to Thai, to prenatal. Her favorite, both to give and receive, is the Hawaiian practice of traditional style lomilomi. “I had a massage where someone did lomilomi on me and it felt amazing,” said Hageman. “That’s how a lot of massage therapists pick our specialties – we’re all sort of drawn to what feels good to us.” Besides this, Hageman was intrigued by the lomilomi tenet that the physical and spiritual bodies are intertwined when it comes to health and healing. The Hawaiianoriginated tradition teaches that anything that happens in your emotional life can also affect your physical self. “Emotional events can manifest via pain,” Hageman said. “We hold stress, so if you’re in a car crash and your neck hurts, your body is holding onto that accident. Or, if you had a really emotional thing happen in your life, your body tenses up. We start to feel our emotions in our bodies, but we don’t know that that is what it is. Lomilomi is not the only massage therapy practice that recognizes this, but it is one that addresses it.” The idea of physical and spiritual relationships also influenced how Hageman structured Menari Body Works, her current massage therapy location. Her new building on 237 Belgrade Avenue in North Mankato has a private infrared sauna for relaxation and healing, as well as a 4-foot-long Himalayan salt wall. Himalayan salt has a long history of health benefits: Once its particles are dispersed via heat, they can help with respiratory issues and create negative ions, which are believed to create stress-relieving, energyboosting, and good sleeppromoting biochemical reactions. “It’s really quite fun!” Hageman

said about the salt wall. She offers clients the opportunity to meditate or practice yoga in front of it either before or after treatment. “It creates a cleansing environment. Our energetic bodies and our physical bodies are totally intertwined, and we sometimes forget about our energetic bodies because we can’t see them.” Currently, Hageman employs three other massage therapists: Darcy Nelson, Ingralisa Anderson, and Rachel Nelson, who each bring their own specialty to Mendari Body Works. Hageman said that clients have enjoyed trying the different types of massages available, especially during the initial uncertainty caused by the coronavirus. “People were really loving shiatsu,” she said, regarding a specific practice that involves applying pressure to specific body points in a sequence. “When we first came back from COVID, that was all we were offering because it wasn’t skin-to-skin.” Even though safety measures are now in place to protect clients who do prefer skin-to-skin, Mendari Body Works’ shiatsu treatment remains popular. “Some of our clients haven’t turned back!” said Hageman. “They have permanently switched over from table massage to other modalities.” Regardless of which modality they prefer, Hageman and her colleagues focus on improving their clients’ wellbeing as efficiently as possible. “If I’ve been able to kind of Sherlock Holmes their (the patients’) cases and figure out what is making them be in pain and figure out how to change what is creating that situation, that gives me the ultimate joy, because I know that they’re going to feel better outside the treatment room,” Hageman said. “It’s a weird goal, but I want to get people to the point where they don’t need to come get a massage all the time. They just get to have a nice little maintenance massage and they feel good every day.” MV

MN Valley Business • MARCH 2021 • 13

Charles Dundas and Jessica Clark work on customers’ hair at Northside Hair. Jennifer and Richmond Clark opened the business to offer services for a more diverse clientele.

Hair diversity Northside fills gap in hairstyling By Dan Greenwood | Photos by Pat Christman

efore they opened Northside Hair Co. in North started putting updates,” she said. “Every step of the Mankato, owners Jennifer and Richmond Clark construction process we posted going up until the noticed a gap in local hairstyling options for an day we opened to start getting the word out.” increasingly diverse clientele in Since they’ve opened, the the Mankato area. positive reviews came pouring in, “We wanted to be able to help commending not only the quality whoever walked through the door of the actual haircuts, but also the and not say, ‘we don’t know how to NORTHSIDE HAIR CO. laid back, warm atmosphere. The do that,’” said Jennifer Clark. 316 Cross St., North Mankato couple say they strive to make “There’s a huge need in this Facebook: Northside Hair Co. Northside Hair Co. a welcoming community for stylists that are place – where good conversation 507-720-6749 diverse in all types of hair, especially and building relationships with ethnic. That’s something our town clients is just as important as the is really needing.” actual haircut. The couple had been considering opening up their “One of the most memorable pieces of advice that I own barbershop and salon, and when the previous learned in school is that when you’re dealing with a business at the same location went up for sale, they haircut, 70% is personality and 30% is the cut,” Jennifer took a leap of faith and purchased it in 2018. Jennifer Clark said. “They’re more likely to come back to you Clark said they hit the ground running that very day, if they enjoy your conversation and your personality, using social media to keep new customers in the loop than if you give an awesome haircut and you don’t about their progress. have that customer service.” “The day we bought the property, I opened a On the technical side, years of hands-on experience Facebook account business page for us, and I just has helped them to broaden their skills to meet the

Profile

14 • MARCH 2021 • MN Valley Business

needs of any hairstyle for any hair type. Right after she graduated from Nova Academy of Cosmetology in Mankato, Jennifer Clark took a job at Fantastic Sam’s, where she learned a plethora of techniques from the other hairstylists she worked with, taking a piece from each towards developing her own style. Richmond Clark, who began cutting hair when he was a teenager, compares the trade to driving to a destination. “We all know where Wal-Mart is, but we may take different routes to get there,” he said. “As long as the destination is the same, and as long as the haircut comes out how the client wants it, how you get there is up to you.”

Richmond Clark works on Jaxon Mitchell, 5, at Northside Hair in North Mankato.

Another location soon

The business doubles as a traditional barbershop and a fullscale hair salon. Richmond Clark primarily does men and boys haircuts and shaves, while Jennifer Clark handles the cosmetology side of the business. “For women we do haircuts, colors, perms, eyelashes, manicures, eyebrow and facial waxing – so just about everything,” Jennifer Clark said. “We do silk presses for our African American and biracial clients.” Richmond Clark said there’s an artistic side to some styles, like etching designs and images into the haircut. They’re especially popular among kids and sports teams. Lightning bolts are a common request, as are basketballs and player numbers. Jennifer Clark said shorter haircuts for women have been increasing in popularity lately, and styles that used to be popular decades ago are making a comeback in recent years, from perms to mullets. “For a lot of younger kids – their peers are doing it,” she said. “I had a kid from one of the smaller towns and their whole hockey team did it, so he wanted to get a perm. A lot of young boys are getting perms now. Despite the COVID-19 pandemic, business has been so

Charles Dundas cuts Carter Mitchell’s hair. good that they made the leap to purchase a second location on Front Street in Downtown Mankato, after securing loans from the Southern Minnesota Initiative Foundation. While they don’t have a definite opening date, Richmond Clark said they hope to open in March if everything goes as planned. The new location, Unique Hair and Ink, will focus on men’s haircuts and tattoos by local tattoo artist Donny Cruz, while the original location will become a women’s salon entirely. With two locations on the

horizon, Richmond Clark said forming relationships and community building will continue to be a priority. It’s also his favorite part of the job. “A lot of the time, returning customers come back for the conversations they’ve had and the relationships they’ve built with the barber or cosmetologist,” he said. “You’re asking, ‘how are the kids? How’s the family and how are things going? And they do the same. You’re building relationships that are extremely valuable.” MV

MN Valley Business • MARCH 2021 • 15

Renaissance Glass owner Larry Hodgson works on a piece in his new store at River Hills Mall.

Magic in glass Hodgson opens store at River Hills By Katie Roiger Photos by Pat Christman

magine making a miniature, scale replica over the Scrambler, Family Fun’s original of a carnival ride, from the spinning cars, ride, taking reference photos. Afterward, he to the gears, to the gaudy colors. That spent a week reproducing it in glass. The kind of task takes a master finished Scrambler, which craftsman to produce. he presented to Family Now, imagine creating it Fun’s owners Greg and from molten glass, too hot Gail Hughes, was 28 to touch with bare hands. RENAISSANCE GLASS inches across and weighed It may sound impossible River Hills Mall, near Scheels 11 pounds. to most people, but not to It was a labor of love, but 507-369-3677 Renaissance Glass owner it had its perks besides the Larry Hodgson. When Minnesota’s Family thrill of creation. Hodgson’s grandkids were Fun Carnival Shows was celebrating its 30th allowed to ride the Scrambler for free all anniversary, the carnival workers wanted to week. give the founders something special to Hodgson discovered glassblowing when he commemorate its long history. Hodgson, who was around the age of his grandchildren and was living in Minnesota Lake at the time, was drawn to it like a moth to a flame. He stepped up to the challenge. He climbed all vividly remembers the first time he felt the

Feature

16 • MARCH 2021 • MN Valley Business

After years of doing Renaissance fairs, Hodgson has perfected a number of fanciful pieces. thrill of realizing that he was meant to create something special. Born in the Twin Cities, Hodgson moved to Orlando, Florida, as a young boy at the time when Gatorland was the area’s biggest tourist draw. One day when Hodgson and his family were visiting the theme park, Hodgson glimpsed an amazing sight: A man was shaping molten-hot glass into fanciful figures as a crowd watched. “I was fascinated by it,” Hodgson said. “I must have asked him a hundred questions in half an hour and he answered every one of them. When we left, I told my mom, ‘I’m going to be a glassblower when I grow up!’” His mom, probably remembering Hodgson’s previous aspirations of being an astronaut, football player, or fireman, said “Sure.”

Generations of fans

Fast-forward to an art show several years later. Hodgson, still a fan of the arts, was wandering around the different booths when he happened upon a glassblower. That same excitement he’d felt as a kid came rushing back. The glassblower kindly taught him the basics of the craft, and it was still fascinating to the adult Hodgson. “All of a sudden, a blob of glass became a unicorn or something,” Hodgson said. “To me, it was pure magic.”

People are able to watch Larry Hodgson work on pieces at his store and sometimes they can help out. Once he started glassblowing, Hodgson never looked back. He traveled the country over 20 years, moving from Renaissance fair to Renaissance fair, dazzling countless crowds with his own special kind of magic. At the Minnesota Renaissance Festival, where he has had a booth for 25 years, Hodgson used to give demonstrations of lampwork, the kind of glassblowing

MN Valley Business • MARCH 2021 • 17

in which he specializes. He heats glass rods with torches until they are pliant enough to bend and shape with tools. After they are cool enough to touch, he handpaints his creations. His demonstrations and wares have drawn a cult following of sorts. “I’ve seen third generations of customers come, which kind of freaks you out,” Hodgson said. “It doesn’t seem like you’re that old, but when the kids of the kids who used to buy from you start buying

from you, you realize how long you’ve been doing this.” Customers and fellow artists are often close-knit in the glassblowing world. Shortly after Hodgson became an established artist, he began networking with another Florida glassblower, buying and selling pieces back and forth from each other. Once the other artist retired, Hodgson bought his tools, materials and supplies. During a friendly chat after the sale was completed, Larry realized that the man was the same Gatorland glass

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18 • MARCH 2021 • MN Valley Business

artist who had first sparked his interest in glassblowing. “Crazy small world,” Hodgson said. When Hodgson first started blowing glass, he mostly produced hummingbirds, swans, and clowns – figures he referred to as “simple,” although they’d probably be very difficult for the average person to attempt. After several years of practice, his repertoire has expanded to include nearly anything that his customers request. Dragons are always a favorite, as are pop culture figures like Jack Skellington and Baby Yoda, but visitors can often spot whimsical blown-glass Sasquatch figurines and other tongue-incheek pieces that keep them on their toes. “I like to have fun!” said Hodgson. “I enjoy people’s reactions. I like to make things that tell a little story, like a mouse trying to grab a piece of cheese off a real mousetrap.” After several years in the Renaissance circuit, Hodgson decided to put down roots. He moved back to Minnesota for good and began renting a pop-up store in the River Hills Mall during the Christmas holiday season. The customers in Mankato were as loyal as his Renaissance following, and he began to seriously consider starting a permanent store. In December of 2020, a personal catastrophe gave Hodgson the push he needed. One day just before Christmas, his wife and 7-month-old grandson were sleeping at home when an electrical issue beneath the house started a fire. The house was destroyed, but the family made it out unharmed and none of Hogdson’s tools were damaged. Insurance helped to recoup some of the loss and Hodgson, who describes himself as a “glass-halffull kind of guy,” decided that this was as good a time as any to open Renaissance Glass. “It occupies my time so that I’m not thinking about the house,” Hodgson said. He moved to Mankato so that he could be nearer to the River Hills Mall location while he and his family figured out what to do next. Customers have rallied to show their support, and Hodgson

A tree is an ongoing piece of work where customers can help create leaves for it. decided to commemorate his community’s goodwill by creating a large blown-glass tree that will be a permanent fixture in his store. “What I’m going to do is have the locals come into the shop when we’re working and actually make the leaves for the tree,” Hodgson said. “It can be done safely and simply – they’re just holding the tool and I hold the hot

piece of glass. These leaves I’ll attach to the tree so that [the customers] can come in five years later and go, ‘Hey, I worked out on that thing!’ It’s something that will be the centerpiece of the shop, and it will never be finished.” Renaissance Glass’s atmosphere is very similar to Hodgson’s festival booth, minus the oldtimey costumes. Anyone can visit and see Hodgson and his

apprentices working their trade, turning plain glass into intricate, one-of-a-kind masterpieces. “Each piece has its own individual personality,” Hodgson said. “You could have a hundred dragons or pendants that you’re making, and each one is unique. It never gets old.” MV

MN Valley Business • MARCH 2021 • 19

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Energy Impact of COVID on energy mix

The United States will likely take years to return to 2019 levels of energy consumption and carbon dioxide emissions following the impact of COVID-19 on the U.S. economy and global energy sector, according to projections in the U.S. Energy Information Administration’s (EIA) Annual Energy Outlook 2021. EIA’s projections examine a future in which slower growth in consumption in an increasingly energy-efficient U.S. economy contrasts with increasing energy supply because of technological progress in renewable sources, oil, and natural gas. “It will take a while for the energy sector to get to its new ‘normal,’” said EIA Acting Administrator Stephen Nalley. “The pandemic triggered a historic energy demand shock that led to lower greenhouse gas emissions, decreases in energy production, and sometimes volatile commodity prices in 2020.” 10 years to return EIA projects that total U.S. energy consumption will return to 2019 levels by 2029, although that projection is highly dependent on the pace of U.S. economic recovery. Renewable energy impact EIA projects that electricity demand will largely return to 2019 levels by 2025. Renewable electric generating technologies are projected to account for almost 60% of the capacity additions from 2020 to 2050, and EIA projects that renewables’ share of the electricity generation mix will more than double by 2050.

Retail/Consumer Spending Vehicle Sales Mankato — Number of vehicles sold - 2019 - 2020 1500

2022 forecasts out

The EIA has begun to make projections for 2022. Crude oil EIA forecasts Brent crude oil spot prices to average $53 per barrel in both 2021 and 2022 compared with an average of $42/b in 2020. EIA expects global liquid fuels consumption will grow by 5.6 million b/d in 2021 and 3.3 million b/d in 2022. OPEC production EIA forecasts crude oil production from the Organization of the Petroleum Exporting Countries (OPEC) will average 27.2 million b/d in 2021, up from an estimated 25.6 million b/d in 2020. EIA forecasts that OPEC crude oil production will rise by 1.1 million b/d in 2022. Gas prices U.S. regular gasoline retail prices averaged $2.18 per gallon in 2020, compared with an average of $2.60/gal in 2019. EIA forecasts motor gasoline prices to average $2.40/gal in 2021 and $2.42/gal in 2022. U.S. diesel fuel prices averaged $2.55/gal in 2020, compared with $3.06/gal in 2019, and EIA forecasts them to average $2.71/gal in 2021 and $2.74/gal in 2022. Natural gas EIA estimates that 2020 dry natural gas production averaged 90.8 Bcf/d, down 2.5% from 2019. EIA expects U.S. dry natural gas production to average 88.2 Bcf/d in 2021, down by 2.8% from 2020, and then rise to 89.7 Bcf/d in 2022. Electricity EIA forecasts that total consumption of electricity in the United States will increase by 1.5% in 2021 after falling by 4% in 2020. The pandemic significantly affected electricity consumption in the commercial and industrial sectors in 2020. EIA expects residential electricity use will rise by 2.4% in 2021 as colder winter weather leads to more heating demand. Total forecast electricity consumption in 2022 will rise by 1.7%. Renewable power During the next two years, EIA expects electricity generation capacity from renewable energy sources to continue growing. Although EIA expects both wind and solar capacity growth, solar capacity grows at a faster rate in the forecast. Based on EIA survey data, large-scale solar capacity growth in gigawatts will exceed wind growth for the first time in 2021. CO2 emissions After declining by 11.1% in 2020, EIA forecasts that total energy-related carbon dioxide (CO2) emissions will increase by 4.7% in 2021 and by 3.2% in 2022. Even with growth over the next two years, forecast CO2 emissions in 2022 remain 3.9% lower than 2019 levels.

912 1,033

1200 900 600 300 0

Source: Sales tax figures, City of Mankato Includes restaurants, bars, telecommunications and general merchandise store sales. Excludes most clothing, grocery store sales. $350,000

Sales tax collections Mankato (In thousands)

- 2019 - 2020

600

$468,804

500 400 300 200 100 0

Source: Sales tax figures, City of Mankato

Lodging tax collections Mankato/North Mankato

- 2019 - 2020 $67,724 $26,656

70000 52500 35000 17500 0

Source: City of Mankato

Mankato food and beverage tax - 2019 - 2020 175000 140000

$64,329 $59,202

105000 70000 35000 0

Source: City of Mankato

C. Sankey

MN Valley Business • MARCH 2021 • 21

■

Agricultural Outlook

By Kent Thiesse

Land values increasing into 2021

armland values in the Upper Midwest appear to be making a bit of a correction late in recent months after several years of uncertainty. The improved crop prices in recent months, together with higher levels of government program payments and improved crop yields in some areas, helped boost final 2020 farm income levels compared to recent years. Land value summaries showed that a reduction in average land values occurred in many regions of the U.S from 2014-16 before stabilizing in 2017 and early 2018. Land values were under pressure in some areas in 2018 and in 2019, due to reduced crop yields, the ongoing trade war with China, and low commodity prices. However, overall land values remained fairly stable due to relatively low long-term interest rates, a limited supply of land being offered for sale, and relatively strong buyer interest. Iowa State University does a comprehensive land value survey each December, which is regarded as one of the best resources on trends in Midwest farm land sales. Following is a table showing the average value of Iowa farm land for the past 14 years (20072020), and the percentage change in land values from year-to-year.

Iowa average farmland values (2007-2020) YEAR 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

AVE. VALUE PER ACRE $ 3,908 $ 4,468 $ 4,371 $ 5,064 $ 6,708 $ 8,296 $ 8,716 $ 7,943 $ 7,633 $ 7,183 $ 7,326 $ 7,264 $ 7,432 $ 7,559

% CHANGE +22.0 % +14.3 % (2.2 %) +15.9 % +32.5 % +23.7 % +5.1 % (8.9 %) (3.9 %) (5.9 %) +2.0 % 0.8 %) +2.3% +1.7%

Source: Iowa State University 2020 Farmland Value Survey.

Iowa farmland values rose steadily from 2000 to 2013, with only a minor decline in 2009, before more significant declines from 2014 to 2016. Since 2016, 22 • MARCH 2021 • MN Valley Business

the Iowa Farmland Value Survey has shown an increase in every year except 2018, with an overall increase of $376 per acre or 5.2 percent in the past four years. The 2020 average farmland value in Iowa of $7,559 per acre is still 13.3 percent below the peak average land value of $8,716 per acre in 2013. The average 2020 land values increased in eight of the nine crop reporting districts in Iowa, as compared to 2019 average land values. The greatest increase was +3.8 percent in the South Central district, while the only decline was (0.9) percent in the Southwest district. The Northwest District reported the highest 2020 average land value in Iowa at $9,536 per acre with three counties averaging over $10,000 per acre. The amount of land available for sale continues to be limited in some areas of the State. Trends in farm land values in Southern Minnesota are probably fairly close to the trends shown in the Iowa land value survey for northern crop reporting districts in Iowa. Similar to many areas of Iowa, land values in most portions of Southern Minnesota seemed to stabilize in 2017, before declining slightly in 2018 and 2019. In addition to low profit margins, 2018 and 2019 crop yields in the region were among the poorest in several years for many farm operators. Crop yields in many portions of Southern Minnesota were much improved in 2020, which together with higher commodity prices have helped strengthen land values in many areas. There have been some isolated land sales across Southern Minnesota at fairly high values per acre; however, the overall land value trend in recent months appears to be steady to up slightly from a year earlier, but still well below the peak land values of 2013 and 2014. In the past few years, there has been an increasing gap in the average land price for high quality, well drained farmland, compared to low quality, poorly drained land. One of the best sources of farm real estate values in Minnesota is the University of Minnesota’s “Land Economics” website at: landeconomics.umn.edu. This web site is updated annually in October and accesses a database of various land values, based on farm land valuations reported to the State Revenue Office by County Assessors Offices throughout the State each year, which are adjusted annually based on actual land sales in a given County. This web site allows for selected sorts by County, State Economic Regions, Watersheds, etc., as well as by types of land. Based on returns from crop production from 2015 to 2019, land values in the Upper Midwest probably

should have declined by a much larger margin than actually occurred during those years. In recent years, many farm operators have purchased farmland as an “opportunity investment”, using returns from existing farmland that is “debt-free” to help subsidize the cash flow and debt payment ability on the newly purchased farm land. Similarly, investors have purchased farmland as a long-term investment, accepting current cash rental rates as a desirable annual rate of return. Most economists point to the relative stability in farm land values in the Midwest as the primary reason that we did not see more farm operations discontinuing due to financial collapse or bankruptcies in recent years. Profit margins in crop production have improved for many farm operators in 2020 and 2021; however, profit margins in the livestock sectors continue to be a concern. Farmers are wondering if the improved farm income trends will continue into 2021 and beyond, when there will likely be lower levels of government program payments. The value of farmland accounts for over 80 percent of the total assets in the U.S. agriculture industry. 8 Currently, most signs point toward continued stability and potential further modest increases in 6 land values in the next 12 to 18 months. However, there are some lingering “caution flags” that could 4 potentially reverse this optimistic trend and revert to more downward pressure on land values. These potential 2 challenges include: • Return to lower crop prices and lower profitability 0 M A farming. M J J A S O N D in cropJ andF livestock • Slow-down of the ag export increases that have occurred under the new trade agreements. • Increases in long-term interest rates by the Federal Reserve Bank. 8 • Changes in Federal policies, such as estate taxes, 100 gains taxes, or 1031-exchange policies. capital 6 • Reduced interest to purchase farm land or an 85 increase in the amount of land being offered for 4 sale. 70 • Lack of confidence in the land market by investors 2 and55ag lenders. 40

0 areas of the Upper Midwest experienced Many J F M A M J J A S O N D above25average corn and soybean yields in 2020. J Fyields M combined A M J with J much A Simproved O N D These strong crop prices have stabilized and even increased land values in many portions of Southern Minnesota and other areas of the Upper Midwest. Buyer interest at has been quite strong in recent land auctions 100 months. The future trend in crop prices, the level of 85 yields and profitability in livestock 2021 crop production, along with potential changes in 70 government policy, will likely determine if there is further55strength in land values later this year. Many farm operators and ag lenders are still quite cautious 40 land purchases following the very poor farm on farm profit years from 2016 to 2019 across the region. 25

Kent Thiesse is farm management analyst and senior vice president, MinnStar Bank, Lake Crystal. 507-381-7960); kent.thiesse@minnstarbank.com

Agriculture/ Agribusiness Corn prices — southern Minnesota

(dollars per bushel)

— 2020 — 2021

8 6

$4.57

2 0

$3.74

Source: USDA

Soybean prices — southern Minnesota — 2020 — 2021 8 20 100 16 6 $12.88 85 12 4 70

(dollars per bushel)

8 55 2 $8.25 4 40 0 0 J F M A M J J A S O N D 25 J F M A M J J A S O N D J F M A M J J A S O N D Source: USDA

Iowa-Minnesota hog prices

185 pound carcass, negotiated price, weighted average

— 2020 — 2021

20 100 25 16 85 22 12 $52.02 70 19 8 55 16 4 40 $48.71 13 0 J F M A M J 25 10 J F M A M J J F M A M J Source: USDA

Milk prices

25 22 19 16 13

J A S O N D J A S O N D J A S O N D Minimum prices, class 1 milk Dollars per hundredweight

— 2020 — 2021 25 22

$17.05

19 16 13 10

$14.01 J

20 25 16 22 12 19 8 16 4 13 0 J 10

Source: USDA. Based on federal milk orders. Corn and soybean prices are for rail delivery points in Southern Minnesota. Milk prices are for Upper Midwest points.

C. Sankey

MN Valley Business • MARCH 2021 • 23

Construction/Real Estate Residential building permits Mankato - 2019 - 2020 (in millions)

8000000 7000000 6000000 5000000 4000000 3000000 2000000 1000000 0

Commercial building permits Mankato - 2019 - 2020 (in millions)

$1,684,958 $1,867.2

10000000 5000000 J

Source: City of Mankato Information based on Multiple Listing Service and may not reflect all sales

Existing home sales: Mankato region - 2019 - 2020 (in thousands)

163

300

Median home sale price: Mankato region - 2019 - 2020 (in thousands)

$190,000 $175,000

250

147

200

240

150

180

100

120

0 J

Source: Realtors Association of Southern Minnesota

Source: Realtor Association of Southern Minnesota

Interest Rates: 30-year fixed-rate mortgage

Includes single family homes attached and detached, and town homes and condos

Housing starts: Mankato/North Mankato

— 2020 — 2021

- 2019 - 2020

5.5

4.9

3.8%

4.3

3.7

3.1 2.5

$5,824

15000000

Source: City of Mankato

$1,416,247

20000000

2.7% J

8 M

Source: Freddie Mac

Read us online! 24 • MARCH 2021 • MN Valley Business

Source: Cities of Mankato/North Mankato

Solid. A Agile. Versatile.

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Gas Prices 5

Gas prices-Mankato

— 2020 — 2021

54 43

$2.16

32 21 10 0

2.13

$53.02

$50.94

-4.0%

Ameriprise

$200.59

$205.09

-0.2%

Best Buy

$107.66

$108.78

+1.0%

Brookfield Property

$9.20

$11.30

+22.8%

Crown Cork & Seal

$100.11

$92.61

-7.5%

Consolidated Comm.

$5.28

$5.46

+3.4%

Fastenal

$48.73

$46.47

-4.6%

General Mills

$58.40

$57.62

-1.3%

Itron

$107.50

$94.16

-12.4%

Johnson Outdoors

$115.17

$112.64

-2.2%

$167.41

$175.02

+4.5%

Target

$190.80

$185.59

-2.7%

U.S. Bancorp

$50.45

$44.25

-122.8%

Winland

$3.20

$3.40

+6.3%

Xcel

$65.95

$64.20

-2.7%

— 2020 — 2021

32 $2.20

Archer Daniels

2.21

Percent change

Feb. 3

Jan. 6

Gas prices-Minnesota

Stocks of local interest

0Source: GasBuddy.com J F M A

C. Sankey

MN Valley Business • MARCH 2021 • 25

■

Minnesota Business Updates

■ Archer Daniels fights suit

■ Fastenal stays strong

Six ethanol companies alleging in a lawsuit Archer Daniels Midland manipulated the market are responding in court to ADM’s motion to dismiss the case. There are three other similar lawsuits pending against ADM in the same court. In January, ADM argued in its dismissal motion the cases involving producers suing producers don’t qualify as an antitrust case. The lawsuits alleges ADM violated a number of state and federal laws, including monopoly provisions of the Sherman Act.

Sales trends for Fastenal, which supplies factories across the nation, show that the economy has continued to slowly improve from downturns caused by the coronavirus pandemic. However, the company’s healthy quarter was propelled by sales of safety equipment, including personal protective equipment (PPE), not its mainstay fastener products, the Star Tribune reports. Demand for PPE helped Fastenal earn $196.1 million, or 34 cents per share in the fourth quarter, up almost 10% over the same period last year. Sales increased 6.4% to $1.36 billion for the quarter. Because of the Winona-based company’s business model of providing customers products through onsite locations and industrial vending machines located within factory complexes, Fastenal was able to get into some manufacturing sites that other companies were not.

■ General Mills promotes milk General Milk and MilkPEP have teamed up to highlight the benefits of the cereal and milk duo. General Mills is debuting limited-edition packaging on popular cereals featuring characters, such as Buzz, Lucky and the Trix Rabbit, donning the famous “got milk?” mustache.

■ Brookfield lost $2 billion Brookfield Property Partners, which owns River Hills Mall in Mankato, posted a $2 billion loss as the fallout from the Covid-19 pandemic caused it to reassess the

Employment/Unemployment Initial unemployment claims Nine-county Mankato region Major December Industry 2019 2020 Construction Manufacturing Retail Services Total*

860 293 54 256 1,463

Local non-farm jobs Percent change ‘19-’20

863 513 232 1,447 2,755

+0.3% +75.1% +329.6% +348% +88.3%

Construction

126000 126000 Manufacturing

Retail 113000 Services 113000 Total*

14,839 4,057 1,252 14,974 35,122

16,045 6,981 5,804 28,519 57,349

1400

113000

700 100000

12000 3500 3500 10000

+8.1% +72.0% +4,363.6% +90.5% +63.3%

8000 2800 2800 6000 2100 2100 4000 1400 1400 2000

700 D

300000

2,881 3,010

240000 180000 120000 60000

700 0 0

- 2019 - 2020

(in thousands)

Percent change ‘19-’20

26 • MARCH 2021 • MN Valley Business

2800 2100

Minnesota Local non-farm jobs

Services consist of administration, educational, health care and social 100000 assistance, food andJ otherF miscellaneous services. M A M J J A S O 100000 J don’t F equal M total A because M Jsome Jcategories A not S listed. O N *Categories

3500

130,946

126000

Minnesota initial unemployment claims December 2019 2020

126,557

139000

Services consist of administration, educational, health care and social assistance, food and other miscellaneous services. *Categories don’t equal total because some categories not listed.

Major Industry 139000 139000

- 2019 - 2020

Nine-county Mankato region

F M

M A A M

M J

J J

J A

A S

S O

O N

N D

in food packaging, household cleaners, cookware and other everyday products — have been linked to cancer, low birth weights, immunological effects, thyroid hormone disruption and increased cholesterol levels. About 862,000 Americans drink PFAS-contaminated water, according to the Environmental Working Group. Biden has pledged to designate PFAS as hazardous substances, enforce a limit for them in drinking water, incentivize companies to use alternatives and accelerate research into their toxicity.

value of its real estate. The loss last year compares with $3.2 billion in net income for 2019, a decline the company attributed primarily to “unrealized reductions of values of certain assets within the portfolio,” according to a statement on Tuesday. Funds from operations, a measure of cash flow for real estate companies, were down about 18% to $540 million for the company’s portfolio of office buildings, while FFO from retail properties fell 29% last year to $550 million, according to the statement. The pandemic kept many offices and malls around the world empty for large portions of last year, while also accelerating changes to how people work and shop. Amid this pressure, Brookfield Property Partners’ corporate parent, Brookfield Asset Management Inc., has proposed taking the company private by acquiring the shares it doesn’t already own for $5.9 billion, or $16.50 a share.

■139000 Xcel and wildfires

3500

Xcel Energy 2800 wants to charge its 126000 C o l o r a d o 2100 customers $589.7 million during the next five years to reduce their risk of causing wildfires, but consumer 1400 113000 advocates aren’t buying it. 700 Xcel has cited the catastrophic wildfires in California started by Pacific Gas and Electric as motivation for the 100000 0 J proposal.J F M A M J J A S O N D ■ 3M could pay for cleanup While the cost is less than 1% of a bill’s monthly total, President Joe Biden’s groups representing consumers and businesses say Xcel administration looks poised to should spread out some of the financial burden for this crack down on a group of work to shareholders and not just customers, especially “forever chemicals” that have 139000 3500 an unstable economy. during 300000 139000 been linked to a range of health 3500 12000 2800 problems, a move that could put companies like 3M and 10000 240000 DuPont126000 on the hook for billions of dollars in cleanup 2800 2100 8000 126000 costs. 180000 2100 6000 Per- and polyfluoroalkyl substances — consisting of 1400 113000 120000 thousands of synthetic chemicals used since the 1940s 1400 4000 113000 700

100000 100000 J F

J M

M J

J A

J S

A O

S N

O D

5,598 5,109

300000

120000 60000 J F M A M M A M J J M A M J J

J A A

J S S

A S O N O N D O N D

137,721 108,919

240000 180000 120000 60000 0

J JA

J JS

A AO

S N S

O D O

N N

D D

(includes all of Blue Earth and Nicollet Counties) 300000 240000

December 180000 Unemployment rate 120000 Number of non-farm jobs Number of unemployed

60000 J

0 F

J M

F M A A M J

M J

J A

2019

2020

2.6% 61,484 1,625

3.8% 58,769 2,302

J S

A O

S N

O D

Unemployment rates Counties, state, nation County/area

- 2019 - 2020

M MJ

Mankato/North Mankato Metropolitan statistical area

180000

300000

D 0

240000

Minnesota number of unemployed

- 2019 - 2020

Nine-county Mankato region

60000

Employment/Unemployment

F M A A M J

Local number of unemployed 12000 12000 3500 10000 10000 8000 2800 8000 6000 6000 2100 4000 4000 1400 2000 2000 700 0 0 J F 0 J F

700 2000 0 0 J F M A J F JM FA M M AJ

Blue Earth Brown Faribault Le Sueur Martin Nicollet Sibley Waseca Watonwan Minneapolis/St. Paul Minnesota U.S.

December 2019

December 2020

2.6% 4.0% 5.2% 6.4% 3.4% 2.5% 4.9% 5.0% 3.8% 3.0% 3.5% 3.4%

3.9% 4.1% 4.9% 6.1% 3.9% 3.5% 4.4% 4.7% 3.4% 4.5% 4.6% 6.5%

Source: Minnesota Department of Employment and Economic Development C. Sankey

MN Valley Business • MARCH 2021 • 27

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How to right your savings after pandemic Tiffany Lam-Balfour | NerdWallet

he COVID-19 pandemic and shutdown upended our lives on multiple fronts. While enduring widespread unemployment and the economic downturn, many Americans leaned on their retirement accounts to help make ends meet. If you experienced retirement savings setbacks, consider using these strategies to refill your retirement bucket in 2021 and beyond. “If you had to take a 401(k) loan or withdrawal, empty an IRA out or dig into your Roth, don’t worry, there are ways you can get back on track without it greatly affecting your retirement goals,” says Cameron Burskey, managing director of retirement security at Cornerstone Financial Ser vices in Southfield, Michigan.

Make a plan

Craft a monthly plan to rebuild your retirement fund, says Dan Hoffmann, managing director and financial advisor at Morgan Stanley in Chicago. “Add a little extra each month above your normal contribution,” he says. “Set a calendar reminder every three months to nudge your contribution a bit higher. Big change is hard, but commit to small incremental changes to get your plan back on track.” If you can, try to pay yourself back as soon as possible, advisors say. For those adversely affected by the pandemic, the Coronavirus Aid, Relief and Economic Security Act waived the extra 10% tax penalty associated with early distributions of up to $100,000 in eligible retirement accounts during calendar year 2020. You’ll still owe income tax on your distribution when withdrawn, but you can get those taxes paid credited back if you recontribute your distribution within three years. Lauren Anastasio, certified financial planner at SoFi in San Francisco, suggests working with an accountant to ensure your taxes are filed correctly to take advantage of this tax relief. Anastasio also encourages consumers to repay 401(k) loans more aggressively.

Step up your savings

For some people, the pandemic has offered an opportunity to save. Maybe you haven’t traveled as often or spent as much money on dining out. Or maybe you’ve saved on gas by working from home. “This is a perfect opportunity to continue the ‘less spending’ and start saving more into your 401(k), 403(b), traditional or Roth IRA,” says Lisa Bamburg, co-owner of Insurance Advantage and LMA Financial Services in Jacksonville, Arkansas. “The opening up of America doesn’t mean we have to return to bad

28 • MARCH 2021 • MN Valley Business

spending habits.” For people 50 and older, catch-up contributions for retirement accounts in 2020 and 2021 provide an opportunity to invest an additional $6,500 above the annual contribution limit of $19,500 for 401(k)s and an extra $1,000 above the annual contribution limit of $6,000 for IRAs. “Consider contributing to a traditional, SEP or Roth IRA if you’ve lost access to a traditional employer 401(k),” says Ian Doll, certified financial planner and wealth advisor at RMB Capital in Chicago.

Have a backup plan

Advisors generally consider pulling from retirement accounts to be a last resort. One pandemic lesson learned: A backup plan can combat the need to access funds earmarked for retirement during future financial crises. “Establishing an emergency fund is critical — most Americans cannot cover an unexpected expense of $1,000,” says Hoffmann. “Having savings set aside for emergencies means you don’t need to tap your retirement accounts.”

Revisit your portfolio

Now is a good time to take a good look at the asset allocation of your investment accounts, advisors say. The rapid market sell-off in March 2020 caused record-high trading levels with the majority of investors trading out of stocks and into fixed-income investments, such as bonds or money market funds, according to Rob Austin, head of research at Alight Solutions, a 401(k) record-keeper for large employers, in Charlotte, North Carolina. Despite the market recovery, Austin said Alight hasn’t seen the trend reverse or investors reverting back to stocks from fixed income, which means those investors likely lost money because they missed the market’s rebound. The moral of the story? When investing for retirement, it makes sense to have a longer-term view and avoid knee-jerk reactions. MV

Sponsored by the Carl & Verna Schmidt Foundation

You’ll never follow a budget how to retire rich anyway By Hal Bundrick | NerdWallet

udget? Me? Heck, I can’t even stand to read the directions when I have to assemble something, you say. Have a written plan for my finances? You’re kidding, right? If this sounds familiar, we feel you. Budgeting isn’t for everyone. But here’s the thing: You don’t have to follow a budget to keep your finances on track for lifeafter-work. You just have to keep score.

Track what you own minus what you owe

“Sometimes people get really intimidated by doing budgets, which is understandable. They’re tedious and a pain,” says Charlie Farrell, CEO of Northstar Investment Advisors in Denver. “But if you follow the old practice of removing your savings first from your paycheck, and then you force yourself to live on what’s left, that’s kind of a self-imposed budget, right?” To measure your progress, you can track your net worth. That’s where the keeping score part comes in. You simply add up all the stuff you own, including what you’ve saved, and subtract all the money you owe — that’s called net worth. Take the result and keep an eye on it now and then. That will tell you whether you’re on track for a beach and a back rub when you’re ready for retirement.

Your net worth may be negative

If you’re just starting out, it may be a jolt to find that your net worth isn’t a positive number. “It’s always negative in the beginning because you’re going to have more liabilities than assets. It’s discouraging, but it’s reality,” Farrell says. That’s especially true for those with student loans and early-career earnings. “I think that’s why net worth is important, because it’s a valid number for where you’re at,” says Dallen Haws with Haws Financial Planning in Sierra Vista, Arizona. “Because if you do have debt, whether it’s car loans or mortgages or student loans, that’s real, and

it’s going to stay with you for a long time unless you say, ‘Hey, my net worth is negative. I’ve got to work on this.’”

Improve your net worth

“Eventually, by the time you retire, you want a boatload of assets and basically no liabilities,” Farrell says. Retirement savings will make up the bulk of assets for most people: things like a 401(k), 403(b) and IRAs. The key is to ultimately have a sizable amount of assets that generate income that you can live on. And with less debt, such as a paid-off house and a free-andclear car, more of that income can go to your afterwork lifestyle. “Just hammer away at your savings rate and put yourself on a path to be primarily debtfree ... By the time you retire, you’ll see that your net worth basically takes care of itself over the long term. But you need to hit rough benchmarks as you move along,” Farrell adds. One benchmark is a comparison of your net worth to a multiple of your income. Consider what you make — the amount that currently supports your lifestyle — and know that you’ll need 20 to 25 times that amount to fund your after-work lifestyle, Farrell says.

Compounding builds net worth

The 25-times-income goal is based on a typicallyrecommended 4% retirement assets withdrawal rate. “If you keep your savings rate relative to your earning power every single year, then the numbers pretty much self-adjust over time,” Farrell says. Compounding helps build momentum. “Once you get to two to three times your household income in savings, your portfolio begins to do more and more of the heavy lifting,” he adds. MV

MN Valley Business • MARCH 2021 • 29

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