A new type of economic development in Northfield: co-working

I’ve long thought about how economically beneficial (and cool) it would be to have a co-working space in Northfield, ever since Tracy Davis blogged here about the idea back in 2008

I’ve been to the 3rd Place coworking space in St. Anthony Park in St. Paul for meetings. I’ve been to CoCoMSP‘s Lowertown location in downtown St. Paul several times for meetings and conferences. Next week I’ll attend a conference at their new downtown Minneapolis location in the Grain Exchange building. See this Oct. 28 WCCO-TV story (text and video) about coworking there (the ‘brain exchange’ as Mpls Mayor RT Rybak evidently calls it) titled CoCo Reinvents Office Space In Twin Cities:

Aldsworth Building, 19 Bridge Square, NorthfieldMore recently, I’ve been mentioning to people that the old Aldsworth Building on Bridge Square would be perfect for this, now that Neuger Communications Group has taken it over. It’s currently sitting empty.

Megan Allen Tsui and Griff WigleyIt’s now looking like momentum is building for a co-working space in Northfield.

Earlier this week I met with Megan Allen Tsui, the new Executive Director of the Northfield Enterprise Center (NEC). She’s been exploring the coworking idea with the NEC board and has a new blog post about it titled Coworking as Business Accelerator In Northfield? A couple of excerpts:

One of the ideas that is being looked at is something called a Coworking space. They are spaces for innovative thinkers, entrepreneurs, freelancers, mentors, and sometimes non-profits to gather together around the concept that together they can build more successful companies and organizations. They are designed to be the best of many things- cool workspace, coffeehouse, social club, and high-tech conference centers.

NECThere are several business models for Coworking locations…and at this point I believe the NEC is in “listening” mode. What do you think of this idea? Would you rent space to work a few times a week? How about a conference room that has all the latest high-tech bells and whistles yet looks out over the beautiful, historic downtown?

What if you could grab a cup of your favorite coffee and head to a space where you meet really fun, cool, innovative people doing amazing things together? Could a space like this keep recently graduated college students from leaving town?

I think the economics of a co-working facility are looking brighter, as more small organizations decide to locate in them. For example, the Citizens League recently announced that they’re moving their headquarters to CoCoMSP St. Paul in January. What small Northfield organizations could benefit from doing likewise?

What seem to be the pros and cons of a coworking space in Northfield? What questions and concerns do you have?

I’m planning to be an informal champion for it but I’m not business-savvy enough to know whether it would work here.

So let the discussion begin.


  1. Tracy Davis said:

    I’ll have to look at the resources above before I can comment intelligently, Griff. I still have a visceral sense that there could be a demand for some sort of co-working space in Northfield, but probably not along the lines of most existing models.

    Which features/needs/benefits most struck you? Speaking for myself, I’ve found that even though I have two dedicated work spaces (a home office, and an office downtown), I feel the need for more incidental social interaction.

    November 26, 2011
  2. Griff Wigley said:

    Tracy, yes, the social aspects and collaborative opportunities would be attractive to me.

    Different sized meeting rooms would also be helpful.

    November 28, 2011
  3. Dean Kjerland said:

    What was once the lab space for ArcheoPaleo was transformed back in late 2009 into a ‘creative commons’. It has at various times provided office or meeting space and/or event space (for rent or otherwise) for the innovative folks from Northfield Arts website team, Riverwalk Arts Quarter, the Northfield Transit Committee, Market Fair, Bastille Day, Xmas Jam (the acoustic kind), ArcheoPaleo, ArtOnWater’s BlackBox(back)Gallery, The Bly Campaign, my birthday dinner, several college interns, the planning and execution of the Celebration of Math project, and our condo Board meetings. Creative Commons has a conference table, lots of chairs, a sink and mini-fridge (tea, juice, cheese), unique ambience, antiques and fossils, fine art, downtown location, is fully accessible, convenient to Mexican and Indian take-out, has wireless internet, computer and printer, overhead (transparency) projector and screen, key privileges, basic CD/VCR, resident manager, and community spirit. The challenge for something more formal is to monetize the concept.

    November 28, 2011
  4. kiffi summa said:

    Does anyone remember why the NEC was started years ago?
    To create a business incubator!

    But there was no building to use, no interest, no $$$$$….

    So if there IS interest now, and given the Aldsworth building doesn’t exactly have the inspirational qualities of the pictured space, it may be a possibility … but how would the finances work?

    ? To what extent would the NEC financially support it? (The NEC gets 50K from the EDA and that is for expenses and a half time director)
    ? How would its internal finances work? would people pay ‘rent’?
    ? Who would pay the utilities and the taxes?
    (Excel energy will tell you that the average utilities(over a year period) for a 2000sq.ft. retail space are about $330 a month)
    ? What NEC staff act as a ‘concierge’? office manager?
    ? Would each user furnish their own space?
    ? How would copying and secretarial services be managed/financed?

    ***? What would a budget for this project realistically look like? ***

    Given the recent Council discussion on defunding the EDA’s levy, and what seemed like a possible majority vote for that (although still funding the ‘partners’) it seems like there is an awful lot up in the air.

    November 28, 2011
  5. Griff Wigley said:

    Kiffi, if you look at the other coworking sites, you’ll see that users pay fees to use the space: hourly, half-day, daily, x days/week or month, weekly, monthly, etc. Lots of variations. Additional fees can be charged for use of a conference room or larger meeting room.

    Most of the work spaces are communal, it, open tables and chairs which anyone can use to plop down with their laptop. So ‘furnishing’ is a non-issue.

    I don’t recall ever seeing any of the sites offering copying/secretarial services. Those just aren’t in demand anymore.

    This venture will need a detailed financial plan before the NEC board signs off on it, I presume.

    November 29, 2011
  6. Megan Tsui said:

    These are all great questions and we look forward to answering them in the upcoming months. The NEC has hired an intern from St. Olaf during January to help write a feasibility study, that as you know, looks at the market and the finances.

    Thank you for providing some great info about costs!

    Stay tuned…
    Megan Tsui

    November 29, 2011
  7. Griff Wigley said:

    Google’s Eric E. Schmidt, Executive Chairman (former CEO) was in Mpls today. Strib article & video: Face of Google faces Minneapolis.

    He visited CoCo’s Mpls location.

    Later Wednesday, Schmidt appeared with Minneapolis Mayor R.T. Rybak at the small business incubator CoCo Minneapolis, based in the former Minneapolis Grain Exchange, and visited with several local technology entrepreneurs.

    Schmidt praised the incubator concept, in which entrepreneurs meet to share office space and ideas, and the city’s role in helping promote it.

    Schmidt said it is a better alternative to people working alone out of their homes. “Distance-working is a disaster,” Schmidt said. “People want to work in a group. People are social.”

    November 30, 2011
  8. Ross Currier said:

    Griff and Megan should be thanked for promoting this latest trend in structuring, or housing, emerging small businesses. With the high rate of unemployment and the low rate of investment, alternative approaches must be considered.

    Kiffi is correct, at least as far as I’ve heard, the NEC was originally formed to create a business incubator. One might speculate that they found that model not to be financially feasible; perhaps this new model might be feasible.

    Keith Covey, founder and long-time board member of the NDDC, has talked about Downtown Northfield, MN being a business incubator, citing the number of Northfield’s mid-sized and and even large businesses that started small in downtown. In fact, on the NDDC Board Business Visits, we often hear that start-up or relocated businesses appreciate the convenient and affordable availability of accounting, design, finance, legal, marketing, and technology service professionals in our walkable business district. Shared administrative support would probably also be appreciated.

    Thanks are also due to Kiffi for raising some important questions. Based on my discussions with business owners over the years, the “market” demand for commercial space is generally based on price. If the price, or rent, is perceived as being too high, or “unaffordable”, the entrepreneurs will continue to work out of their homes.

    Sometimes there is a subsidy for the rent that tenants pay for these incubators. About two years ago, in an EDA subcommittee, Norman Butler proposed a new loan program that would offer declining rent subsidies for expanding, start-up, or relocating businesses. The program would have been for any commercial property in Northfield, an approach that is not tied to a single building.

    As you know Griff, I still prefer paper and ink. On a recent visit to “Nordeast”, I picked up a copy of “The Journal” (“Serving Downtown & Northeast Minneapolis”). The cover story was on CoCo Minneapolis.

    The 16,000 square foot co-working space is shared with Project Skyway, a “tech accelerator program”. The program was started by Cem Erdem, founder of Augusoft. Apparently his success at the software company provided him the resources to back Project Skyway. The project also supplies seed capital in return for stock. Such a participant would be extremely valuable.

    Personally, I think Tracy’s comment takes the analysis to another level. Shared administrative support might be appreciated; below-market rent would be valuable; innovative business people, like Tracy, seem to thrive on “incidental social interaction”.

    Fortunately, downtown Northfield has a great offering of “great, good” meeting places: http://nddc.org/weblog/post/5198/

    December 5, 2011
  9. Griff Wigley said:

    Ross, I think subsidies/grants, etc on the coworking space (rent, furnishings, build-out, utilities, etc) would be a BAD idea. This space should compete fairly with every other commercial property owner in town.

    December 5, 2011
  10. kiffi summa said:

    Well.. then it won’t happen, Griff. I think an incubator would have to be subsidized.

    Do you have any idea how much ‘subsidization’ , in the form of forgiven rent, is done by landlords with a functioning retail business in a space? I don’t want to quote that now, since the person just left, but believe me… it’s huge!

    And since that space has been empty, I have never had so many requests to use the old “Fit to be TRI’D” space for NO remuneration.

    Here’s a fact: on ‘shutdown’ rate with Xcel, that 2Ksq.ft. space is $80 a month, but as soon as it is used, even a little, it reverts to regular rates, and Excel says that is an average of $330 a month over the year…
    I don’t know if summer or winter is more costly, i.e. air conditioning vs. heating.

    and that’s just the utilities…

    December 5, 2011

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