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Gander Mountain
The new Gander Mountain store in Crossing Meadows in Onalaska. Erik Daily

Construction continues on the Riverside Center III office building that will house additional Logistics Health Inc. offices in downtown La Crosse by late summer. 

In Winona, Bay State Milling Co. is upgrading its plant.

A bakery expansion project continues at Kwik Trip's support center in La Crosse, where construction will begin this fall on a new ice cream plant for the convenience store chain.

Gander Mountain's new store in the Crossing Meadows shopping center in Onalaska is scheduled to open in April.

Those are some signs that an economic recovery has begun in the 7 Rivers Region.

Several leaders predict the recovery will continue this year but at a slow pace.

Brooks predicts recovery will continue at slow rate

"I'd say recovery will continue to be slow" in the 7 Rivers Region, said T.J. Brooks, associate professor of economics at the University of Wisconsin-La Crosse. "That's because part of the recovery is about making an adjustment in where jobs are and things like that."

According to the National Bureau of Economic Research, the nation's longest recession since World War II began in December 2007 and ended in June 2009 after 18 months.

The 7 Rivers Region probably didn't go into recession until the end of 2008, a year after the national recession began, Brooks said.

And the economic recovery in the region probably didn't begin until late fall 2010, he said.

The decline in the number of building permits for new houses seems to have stopped and average home sale prices are rising "a little bit," Brooks said.

Some signs showed up last summer

"It's been a very slow recovery," said Bill Brockmiller, regional labor market analyst in La Crosse for the Wisconsin Department of Workforce Development. "I started seeing some signs (of recovery) last summer and particularly in the fall. There was some hiring in manufacturing, which was good to see. But it's still not where we were" before the recession.

The La Crosse metropolitan area's retail sector did better in 2010 than in 2009, and picked up in the latter part of the year, Brockmiller said. And there was an increase in local professional and business services jobs in the area last year, he said.

Brockmiller said he expects growth in area healthcare employment to resume this year. It was a unusual to see a decrease in healthcare employment last year, after continued growth in previous years, he said.

Brockmiller also expects to see slow growth in manufacturing and retail employment in the area this year.

La Crosse chamber president expects slow growth

"I think we'll see slow growth" in 2011, said Dick Granchalek, president of the La Crosse Area Chamber of Commerce. "People have downsized since 2008 and they have learned to do more with less."

There are bright spots in the local economy, Granchalek said, citing projects such as the new Gander Mountain store in Onalaska, plans to build a large Festival Foods store in the Village Shopping Center, buildings under construction at UW-L and Viterbo University, Riverside Center III and Gundersen Lutheran starting construction on its new 400,000-square-foot hospital building.

"It will be a challenge to fill spots like the old Gander Mountain store and the Quillin's (supermarket) on Mormon Coulee Road, when they become vacant" this year, Granchalek said. But people have taken advantage of redevelopment opportunities in the past, he said, citing the Three Rivers Plaza retail-office-condominium development on Copeland Avenue.

"I think we'll see some other opportunities on the drawing board," he said. "It's just a matter of people's willingness to risk financing and investment."

Hill is ‘cautiously optimistic'

James Hill, executive director of the La Crosse Area Development Corp., said he is "cautiously optimistic" that the area's economic recovery will continue.

"The major concern all of us should have is the ongoing threat of having a pretty significant stumble in this (national) recovery," Hill said. "We've had this perfect storm of things this winter with escalating prices for oil, food, clothing and commodities, and a succession of storms across the country. And all of this uncertainty about budgets at the state and national level."

But there are bright spots, Hill said. "The fundamentals have stayed strong," he said, adding businesses are still adding jobs downtown, geography helps ensure the area is a good place for distribution businesses, and the City and County Joint Board of Harbor Commissioners are developing an updated port and waterfront plan. Water transportation is an advantage for communities such as La Crosse, he noted.

Although La Crosse's growth is limited by bluffs and the Mississippi River, Hill said the supply of land available for commercial and industrial development in the metropolitan area "is fine." Land is available in the International Business Park in La Crosse, the Lakeview Business Park in West Salem and most recently in the Holmen area, he said.

Besides buildings already under construction, "I think there will be some other construction projects this year" that haven't been announced yet, Hill said.

Slow recovery under way in Winona area

Economic recovery has begun in the Winona area but is going "slowly and without a lot of indication of significant job creation," said Della Schmidt, president and CEO of the Winona Area Chamber of Commerce.

Some local manufacturers are seeing more orders for their products, she added. And local restaurants "seem to be holding up pretty well," Schmidt said, although special promotions and deals are more common than they were a few years ago. "They've had to repackage and remarket," she said.

"What we hear from (business) owners and executives is cautious optimism," Schmidt said. "Versus in 2009 we heard a lot of discouragement, fear, hesitation and not wanting to plan for the future. The mentality was very much survival mode. But now people are cautiously planning for the future.

"They might not be planning out five years like they used to because there are still so many unknowns," Schmidt said, such as whether the new federal healthcare reform law will be changed or repealed. Federal, state and local government budget issues also make for uncertainty, she said.

Bright spots for the Winona area include its large healthcare sector, three institutions of higher learning, large and diverse manufacturing sector and healthy retail sector, Schmidt said. "The greatest challenge for the future continues to be (a tight supply of) available, affordable commercial and industrial land and buildings."

Winona manufacturing is picking up

Winona manufacturers have noticed a pickup in orders and the area's retail sector continues to be at least "fairly stable," said Judy Bodway, the city's assistant city manager for economic development. She expects to see continued slow growth in the Winona economy this year.

"I think our healthcare (sector) is starting to pick up," Bodway said. "Last year, Winona Health had a pretty good year. Healthcare is a big part of our employment base. We've got two assisted-living facilities being built right now, which is a part of the healthcare industry."

Late last year, $5.2 million in industrial development bonds were sold to allow Bay State Milling to buy and install new equipment. "So that's a $5.2 million investment in their facility, which is huge," Bodway said.

Meanwhile, Winona plastics company PlastiComp may build a new plant on Wilson Township land south of Winona that's been the focus of annexation talks. And the recent sale of Winona-based Composite Products Inc. to an Indian conglomerate is expected to bring expansion of the local facility, Bodway said.

The Winona economy's biggest strength is its diversity, Bodway said, adding that education, healthcare and manufacturing are major sectors. Another strength is water transportation and the city's commercial harbor operation, where a new dock hopefully will be built this year, Bodway said.

"Our biggest issue is lack of land and buildings," Bodway said, a major reason why city officials are interested in the proposed annexation of a few hundred acres of land near Hwy. 43 and Interstate 90 south of Winona.




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