Huge housing, retail complex in the works for former IBM campus in Rochester

ROCHESTER – Big changes could be coming to the former Big Blue campus, with plans in the works to develop 200 acres of unused land as housing, retail space and possibly a new sports complex.

The latest development plan for the site, now known as the Rochester Technology Campus, was released this month in a report to the Minnesota Environmental Quality Board. It shows the potential for as many as 2,624 residential units to be built on the campus, along with 1.5 million square feet of new commercial and industrial space.

Much of that commercial space, including retail and hospitality, would be built to the east to connect with a nearby shopping center, with housing to the north and south, and industrial use to the west of the existing campus. Plans also call for 37th Street to be extended west to meet up with Valleyhigh Drive.

Development of the site would likely happen over the next five to 10 years, according to Industrial Realty Group, which purchased the sprawling 490-acre site from IBM in 2018 for $33.9 million.

"If I told you all of it would develop in the next five years, I think that would be extremely optimistic," said Evan Vlaeminck, vice president and asset development manager for IRG. "This is a long-term vision for developing the campus."

In its proposal, IRG lays out two scenarios for the campus: one including a proposed regional sports complex and another without it. The campus is one of three sites being considered for the $65 million sports facility, to be built using funds from a sales tax extension approved by voters in 2023. That decision could come by the end of this year.

If the site is chosen for the sports complex, it would double the amount of proposed recreational space on the campus from 1.1 million to 2.2 million square feet. The number of housing units would drop to 1,920.

"We think we would be a positive location for the sports complex because we are centrally located, we are off [Hwy.] 52 and we have all of the utility infrastructure already in place," Vlaeminck said.

The undeveloped land around the existing campus, much of it grassy fields and woodland, has been a point of discussion for years. In 2015, before IRG purchased the property, the city had been in talks with IBM about buying the property for park space. Those discussions never moved ahead, however.

Vlaeminck said IBM had intentionally left large swaths of the site undeveloped for security reasons, even building small hills around the site to block lines of sight to the facility.

At its peak in the early 1990s, IBM had 8,100 employees working at the Rochester campus, a number that has dwindled to about a quarter of that today.

"Because the utility demand IBM once had was so large, so dramatic, we can develop the additional 200 acres without really posing a new utility demand," Vlaeminck said.

The proposal from IRG would not affect any of the existing 3.1 million square feet of office and warehouse space on the campus. That space is now used by a mix of tenants, including IBM, which leases back about a third of the complex.