MANKATO — The biggest private downtown Mankato development ever just got bigger.
Tailwind Group of Mankato has already begun construction on a seven-story office tower on the corner of Warren Street and Riverfront Drive and a four-story multi-use building on South Front Street. Now, Tailwind has announced it will also begin construction this summer on a third building on the block — a five-story corporate office that will initially house 80 to 100 employees.
"It's a hundred more employees downtown," said Kyle Smith, owner of Tailwind. "To have it happen ahead of schedule is exciting.
"It's a combination of people looking for a different level of office space. But it's also that people have accepted that downtown is for real," Smith said.
The name of the corporate tenant will be made available in the next couple of weeks, but it is an existing company in Mankato. Smith said the new tenant will occupy about 75 percent of the new building.
City manager Pat Hentges said the fact tenants are willing to pay for higher-end office space — Smith said rates are 20 to 30 percent above traditional market lease rates here — shows the city has reached a new level of success in transforming the downtown.
"The leases they are talking about are substantially more than what they're paying now, so their interest to be in a high-end development confirms the vision Tailwind and others had for this area. It's really coming to fruition as a corporate and entertainment district," Hentges said.
With the cost of the new building, the total construction in the block will top $20 million.
The seven-story building is $9.2 million, while the four-story building is $4.2 million. With the parking ramp, the project was at about $16 million, prior to the announcement of the third building being a go.