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Commercial development slows down: Outside businesses more hesitant to enter Dickinson market

The sluggish oil economy has dampened some facets of local industry and has put other prospective new commercial developments on a slower track, if not a pause.Brian Bochman, developer and vice president of Meyer Real Estate Group, said the state...

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The Sundance Village by the Meyer Real Estate Group in northeast Dickinson is still a field as the company has paused its commercial and residential developments as it waits on oil prices and the economic climate in the area to stabilize. (Press Photo by Andrew Haffner)

The sluggish oil economy has dampened some facets of local industry and has put other prospective new commercial developments on a slower track, if not a pause.
Brian Bochman, developer and vice president of Meyer Real Estate Group, said the state of oil has affected some of the various metrics considered by outside commercial entities when deciding whether or not to enter a new market.
“It’s certainly slowed some of the traffic down and definitely impacted some of the tenants we had looking to come to Dickinson in the retail sector and in the industrial sector,” Bochman said.
Because of the general slowdown, he added, potential tenants are now “really in a kind of wait-and-see mode, like everyone else.”
Meyer had previously built out the Sundance Cove development on the east side of Dickinson and is currently developing Pinecrest Commons on the northwest side.
Bochman said development decisions for another Meyer-owned area called Sundance Village are paused for now, as the land is included in a potential future golf course project still taking shape with Dickinson Parks and Recreation.
Other efforts to plan for future development have been limited by the unsteady ground of the oil market, he said.
“When we first started, we were able to project out two years, three years - now, you really can’t, because of the oil prices,” Bochman said. “To a degree, we’re kind of tied to some of that, whether it’s through financing agencies, banking, the rest. All of those things are really tied to the oil-price equation.”
In the meantime, Bochman said, the game-plan for Meyer is to start lining projects up and laying down the groundwork for when things do begin to move.
“You get all of your infrastructure, the stuff people don’t see,” he said, listing things like obtaining the necessary earth-moving equipment and completing planning and platting. “You get all of your things ready as they can be, so when the time does come for things to kick back off again, you’re ready to go.”
While some commercial tenants are hesitant as they watch market statistics like local population, traffic movement and average disposable income, Bochman said Meyer’s housing sales are still going through.
Roers Vice President Larry Nygard also spoke to the continued relative strength of the local housing market, adding that Roers developments elsewhere in the state have found weaker markets than in Dickinson.
Within the housing segment, he said, single-family homes are outperforming multi-family dwellings which have seen a “significant slowdown in demand.”
Nygard said Roers’ commercial efforts, such as bringing further business into its West Ridge development, are continuing as they have in the past despite the wider economic landscape.
“We’re still talking with some new retailers that are looking at Dickinson, so we hope that in ‘16 we can bring some new retailers to the market, both in the West Ridge market center and also some new construction,” Nygard said.
He added that it’s “too early” to disclose the names of the businesses, but said they’re national brands that are still interested in Dickinson as a possibility.
He also acknowledged that the slowdown has created hesitation for some potential newcomers.
“Everybody’s just a little tentative because of the oil price, and they don’t know the impact to their business,” Nygard said.
However, he said, some businesses have seen the slowdown as a time of minimized issues with hiring and staffing, which has lent some confidence in that regard.
Discussions with possible tenants are ongoing, but he admitted the slowdown is readily felt.
“We’re still doing the same sorts of things in the market - new tenants and bringing businesses to town,” Nygard explained, “but, that being said, there are a lot fewer people right now that are interested.”
Dickinson City Administrator Shawn Kessel said the prevailing attitude in the city’s commercial development right now is one of a status check.
With outside business interests waiting to see how things pan out, he said, it may be revealed that market saturation has been reached around certain products.
Still, though, Kessel said there remain “a lot of people who really believe in Dickinson.”
The prevailing diversity of local economy remains attractive to outsiders, he said, but future choices to enter the Dickinson market will be less clear-cut than in the oil boom era of year-over-year record-setting in terms of permit issuance and sales tax growth.
“It’s easy to make a decision in that environment, whether or not to move forward,” Kessel said.
“It takes real commitment to move forward with a project in today’s environment, as opposed to the last three or five years.”

Related Topics: DICKINSONHOUSING
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