April 26--Cray Inc. on Tuesday made it official: The growing employer in downtown St. Paul is relocating to the suburbs.
The company issued a statement Tuesday afternoon confirming its plans to become the anchor tenant at the Mall of America's new office building in Bloomington.
The Seattle-based supercomputer company will lease about 87,500 square feet of space in the top four floors of the Mall of America's 10-story building.
While there has been speculation for several weeks about the company's plans to leave the capital city's downtown area, this is the first time Cray has publicly addressed its future plans.
"After a careful consideration of all our options, we have made the decision to leave our current location in downtown St. Paul and relocate our employees to The Offices (at the Mall of America)," Fred Kohout, chief marketing officer at Cray, said in a prepared statement. "St. Paul has been a great regional home for Cray over the last seven years. While it's always tough to leave a location you love, we are excited to move to a new site that will better facilitate our growth, and allow us to continue to build upon our strong presence in the region."
The $325 million Mall of America expansion project, begun in 2014, will include a 342-room JW Marriott hotel, office tower, high-end retailers, restaurants, a tourist welcome center and large event space. It will be an extension of the Mall's north side on all three levels. (Courtesy of DLR Group/Mall of America)
Cray moved into what was formerly called Galtier Plaza in downtown St. Paul with some 200 employees in 2009.
With more than 350 employees now working out of the downtown office, the company has outgrown the space, according to people familiar with the move.
Cray expects to grow even more before completing its move to its new offices in the first half of 2017.
MALL AMENITIES IMPRESSES CRAY
In choosing the Mall of America's campus for its new home, Kohout pointed to the "amazing" facility's "impressive amenities that (its) local employees, guests... and visiting employees will be able to take advantage of" as a key selling point.
The office building was part of the Mall of America's $325 million expansion, which includes construction of a 342-room Marriott hotel, a tourist welcome center and a large event space.
Neither the St. Paul mayor's office nor the city's department of planning and economic development responded to requests for comment Tuesday.
Julie Bauch, chair of the the Greater St. Paul Association of Building Owners, previously called losing Cray "a big blow for St. Paul."
Cray reportedly was looking for about 100,000 square feet, Bauch said, a challenge in downtown St. Paul's shrinking universe of commercial office space.
"It's sad that we don't have room or that we haven't found a location for them to stay in St. Paul," Bauch said. "I think anytime we lose someone, and a company with 400 jobs and in growth mode ... that's a big blow for St. Paul. ... We are in a very positive growth mode in our residential and hotel markets. ... We need to focus on (our office environment and retail) to balance out what is happening in downtown St. Paul."
ST. PAUL REMAINS IN GROWTH MODE
As recently as April 2015, Cray CEO Peter Ungaro was visiting St. Paul to tout the strengths of the Twin Cities market and announce plans to add 75 workers to its Mears Park offices, raising the total workforce there to 400 employees.
St. Paul Mayor Chris Coleman has frequently referred to Cray as an example of the type of employer he'd like to see more of downtown.
City staff had been working to keep Cray and eventually it came down to "landlord issues" and other "irreconcilable differences," said Ward 2 City Council member Rebecca Noecker.
"It's a huge disappointment. I think in this case, it's not the end of the world for downtown," the councilwoman said. She later added: "We're doing great on residential and hotel, but I'm obviously concerned about commercial and retail not keeping up with residential."
She has asked the city planning department for a list of the 30 largest business owners in her ward, which includes downtown. She plans to reach out to them to discuss their needs.
Coleman points to the growth around St. Paul and in particular the Lowertown neighborhood Cray will be vacating. He is confident the local economy is strong enough to absorb the loss and bounce back, the mayor said through a spokesperson.
ST. PAUL LURED CRAY FROM MENDOTA HEIGHTS
In 2009, the city of St. Paul's Housing and Redevelopment Authority approved a $400,000 taxpayer subsidy as an incentive for the company to relocate from Mendota Heights to Lowertown.
Cray moved into the former Galtier Plaza, rebranded it Cray Plaza and invested $4.5 million into remodeling nearly 51,000 square feet of office space. The office tower went from being one-third empty to nearly fully occupied.
Cray, which traces its origins to the Twin Cities and Chippewa Falls, Wis., brought some 200 jobs to downtown St. Paul in the first year alone, many of which paid $100,000 or more.
The move, celebrated by city leaders, represented a victory for the mayor's office and St. Paul boosters eager to fill empty spaces in Lowertown and market the neighborhood to future employers.
Pioneer Press reporter Frederick Melo contributed to this report.
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